Doitall Company makes all its sales on account. Doitall's accounts receivable payment experience is as follows:
Doitall provided information on sales as follows:
$\begin{array}{lr}
\text { Percent paid in the month of sale } & 18 \% \
\text { Percent paid in the month after the sale } & 77 \% \
\text { Percent paid in the second month after the sale } & 3 \%
\end{array}$ $$\begin{array} { l l }
\text { September } & \$ 120,000 \
\text { October } & \$ 150,000 \
\text { November } & \$ 220,000 \
\text { December (expected) } & \$ 250,000
\end{array}$$
-Refer to the Figure.What are the expected cash receipts for November?

Question

Doitall Company makes all its sales on account. Doitall's accounts receivable payment experience is as follows:
Doitall provided information on sales as follows:
 $\begin{array}{lr}
\text { Percent paid in the month of sale } & 18 \% \
\text { Percent paid in the month after the sale } & 77 \% \
\text { Percent paid in the second month after the sale } & 3 \%
\end{array}$ $$\begin{array} { l l } 
\text { September } & \$ 120,000 \
\text { October } & \$ 150,000 \
\text { November } & \$ 220,000 \
\text { December (expected) } & \$ 250,000
\end{array}$$
-Refer to the Figure.What are the expected cash receipts for November?

Quizplus · Accepted Answer

For November's expected cash receipts, we calculate the cash collected from sales made in September, October, and November based on the percentages provided for when payments are received. - From September sales ($120,000), 3% is paid two months later, which is $3,600.- From October sales ($150,000), 77% is paid the month after, which is $115,500.- From November sales ($220,000), 18% is paid in the month of sale, which is $39,600.Adding these amounts: $3,600 (September) + $115,500 (October) + $39,600 (November) = $158,700.

Doitall Company Makes All Its Sales on Account -Refer to the Figure