Jumbotron Inc. had sales of $8,000 in November, $14,000 in December, and projects sales of $10,000 for January, $12,000 for February, and $8,000 for March. The ﬁrm's cost of goods sold
Every month is equal to 70% of the next month's sales. The ﬁrm collects its receivables in 60 days
And pays its payables in 30 days. The ﬁrm begins January 1 with $10,000 in cash. All sales and
Purchases are on credit.
What is Jumbotron's total cash collections for February?

Question

Quizplus · Accepted Answer

Jumbotron collects its receivables in 60 days, so in February, it will collect the sales made in December, which were $14,000.