The following credit sales are budgeted by Polex Electronics: $$\begin{array} { l r }
\text { January } & \$ 124,000 \
\text { February } & 120,000 \
\text { March } & 135,000 \
\text { April } & 140,000 \
\text { May } & 142,000
\end{array}$$ The company's past experience indicates that 50% of the accounts receivable are collected in the month of sale, 30% in the month following the sale, and 18% in the second month following the sale.Two percent are uncollectible.How much does the company anticipate as cash receipts for March?
A)$132,300
B)$125,820
C)$135,060
D)$122,300

Question

The following credit sales are budgeted by Polex Electronics: $$\begin{array} { l r } 
\text { January } & \$ 124,000 \
\text { February } & 120,000 \
\text { March } & 135,000 \
\text { April } & 140,000 \
\text { May } & 142,000
\end{array}$$ The company's past experience indicates that 50% of the accounts receivable are collected in the month of sale, 30% in the month following the sale, and 18% in the second month following the sale.Two percent are uncollectible.How much does the company anticipate as cash receipts for March?
A)$132,300
B)$125,820
C)$135,060
D)$122,300

Quizplus · Accepted Answer

For March, cash receipts include 50% of March sales ($135,000 * 50% = $67,500), 30% of February sales ($120,000 * 30% = $36,000), and 18% of January sales ($124,000 * 18% = $22,320). Total = $67,500 + $36,000 + $22,320 = $125,820.

The Following Credit Sales Are Budgeted by Polex Electronics The Company's Past Experience Indicates That 50% of the Accounts