Windy City Kite Company has prepared sales forecasts for the beginning of Year 3 as shown in the top row of the table.Half of Windy City's kite sales are cash and the other half are credit.Windy City collects credit sales the month following the credit sale.What are Windy City's total cash inflows from customers for January?
Windy City Kite Company
Sales Forecast and Collections Forecast

Question

Quizplus · Accepted Answer

Collections in January = 0.5 × December Sales + 0.5 × January Sales
Collections in January = 0.5 × $1,100 + 0.5 × $1,000
Collections in January = $550 + $500 = $1,050

Windy City Kite Company Has Prepared Sales Forecasts for the Beginning