The following credit sales are budgeted by Garcia Company: $$\begin{array} { l r }
\text { January } & \$ 306,000 \
\text { February } & 450,000 \
\text { March } & 630,000 \
\text { April } & 540,000
\end{array}$$ The company's past experience indicates that 70% of the accounts receivable are collected in the month of sale 20% in the month following the sale and 8% in the second month following the sale.The anticipated cash inflow for the month of March is

Question

The following credit sales are budgeted by Garcia Company: $$\begin{array} { l r } 
\text { January } & \$ 306,000 \
\text { February } & 450,000 \
\text { March } & 630,000 \
\text { April } & 540,000
\end{array}$$ The company's past experience indicates that 70% of the accounts receivable are collected in the month of sale 20% in the month following the sale and 8% in the second month following the sale.The anticipated cash inflow for the month of March is

Quizplus · Accepted Answer

The anticipated cash inflow for the month of March is $555,480. This is calculated as follows:Cash inflow from March sales = $630,000 x 70% = $441,000Cash inflow from February sales = $450,000 x 20% = $90,000Cash inflow from January sales = $306,000 x 8% = $24,480Total cash inflow for March = $441,000 + $90,000 + $24,480 = $555,480

The Following Credit Sales Are Budgeted by Garcia Company The Company's Past Experience Indicates That 70% of the Accounts