Casa Development, Inc. has budgeted sales revenues as follows: Budgeted Sales Revenues January $55,000 February 75,000 March 90,000 April 80,000 May 60,000 June 35,000 Past experience has indicated that 80% of sales each month are on credit and that collection of credit sales occurs as follows: 60% in the month of sale, 30% in the month following the sale, and 5% in the second month following the sale. The other 5% is uncollectible. Prepare a schedule which shows expected cash receipts from sales for the months of April, May, and June.

Expected cash receipts from sales for the months of April, May, and June are 63,000,51,600 and 34,400

Explanation:

As you can see we apply the percentages of collection of 60%, 30% and 5% to each month credit sales to get the total estimated cash collections.

Casa Development, Inc.

Budgeted Cash Schedule

January February March April May June

Revenues $55,000 75,000 90,000 80,000 60,000 35,000

Credit Sales 80%

Credit Sales 44000 60,000 72,000 64,000 48,000 28,000

Collections 60% 30% 5%

January

44000 26,400 13,200 2,200

Feb 60% 30% 5%

60,000 36000 18000 3000

Mar 60% 30% 5%

72,000 43,200 21,600 3600

Apr 60% 30% 5%

64000 38400 19200 3,200

May 60% 30%

48,000 28,800 14,400

June 60%

28,000 16,800

Total Cash Collections 63,000 51,600 34,400