Dove Corporation began its operations on September 1 of the current year. Budgeted sales for the first three months of business are $250,000, $320,000, and $410,000, respectively, for September, October, and November. The company expects to sell 25% of its merchandise for cash. Of sales on account, 70% are expected to be collected in the month of the sale and 30% in the month following the sale.
-The cash collections in November are

Question

Dove Corporation began its operations on September 1 of the current year. Budgeted sales for the first three months of business are $250,000, $320,000, and $410,000, respectively, for September, October, and November. The company expects to sell 25% of its merchandise for cash. Of sales on account, 70% are expected to be collected in the month of the sale and 30% in the month following the sale.​
-The cash collections in November are

Quizplus · Accepted Answer

To calculate the cash collections in November, we consider cash sales (25% of November sales) and the collections from sales on account from both October and November. November sales are $410,000, so cash sales are 25% of that, which is $102,500. For sales on account in November (75% of $410,000), 70% collected in the same month equals $214,500 (70% of $306,000). From October's sales on account ($320,000 * 75% = $240,000), 30% collected in November equals $72,000. Adding these amounts ($102,500 + $214,500 + $72,000) gives us $389,000.

Dove Corporation Began Its Operations on September 1 of the Current