Rudd Company has budgeted sales revenue as follows for the next 4 months: $$\begin{array} { l r }
\text { February } & \$ 300,000 \
\text { March } & 240,000 \
\text { April } & 210,000 \
\text { May } & 330,000
\end{array}$$ Past experience indicates that 80% of sales each month are on credit and that collection of credit sales occurs as follows: 60% in the month of sale 35% in the month following the sale and 3% in the second month following the sale. The other 2% is uncollectible.
Instructions
Prepare a schedule which shows expected cash receipts from sales for the month of May.

Question

Rudd Company has budgeted sales revenue as follows for the next 4 months: $$\begin{array} { l r } 
\text { February } & \$ 300,000 \
\text { March } & 240,000 \
\text { April } & 210,000 \
\text { May } & 330,000
\end{array}$$ Past experience indicates that 80% of sales each month are on credit and that collection of credit sales occurs as follows: 60% in the month of sale 35% in the month following the sale and 3% in the second month following the sale. The other 2% is uncollectible.
Instructions
Prepare a schedule which shows expected cash receipts from sales for the month of May.

Quizplus · Accepted Answer

The Answer of Rudd Company has budgeted sales revenue as follows for the next 4 months: $$\begin{array} { l r } 
\text { February } & \$ 300,000 \
\text { March } & 240,000 \
\text { April } & 210,000 \
\text { May } & 330,000
\end{array}$$ Past experience indicates that 80% of sales each month are on credit and that collection of credit sales occurs as follows: 60% in the month of sale 35% in the month following the sale and 3% in the second month following the sale. The other 2% is uncollectible.
Instructions
Prepare a schedule which shows expected cash receipts from sales for the month of May.

Rudd Company Has Budgeted Sales Revenue as Follows for the Next