Gallonte Inc.began operations in April of this year.It makes all sales on account, subject to the following collection pattern: 30% are collected in the month of sale; 60% are collected in the ﬁrst month after sale; and 10% are collected in the second month after sale.If sales for April, May, and June were $60,000, $80,000, and $70,000, respectively, what were the ﬁrm's budgeted collections for April?

Question

Quizplus · Accepted Answer

To find out the budgeted collections for April, we need to determine what portion of April's sales will be collected in April. According to the collection pattern, 30% of April sales are collected in the month of sale, so the budgeted collections for April are:

$60,000 x 30% = $18,000

Therefore, the correct answer is B.