Acorn Company's budgeted credit sales are as follows:
April: $100,000
May: $120,000
June: $125,000
Acorn collects 30% of their credit sales during the month of sale, 50% during the month following the
Sale, and the remaining 20% two months after the month of sale. What is the budgeted accounts receivable balance on June 30^th?

Question

Quizplus · Accepted Answer

The budgeted accounts receivable balance on June 30th includes 20% of April's sales, 50% of May's sales, and 100% of June's sales. Calculations: April ($100,000 * 20% = $20,000), May ($120,000 * 50% = $60,000), and June ($125,000 * 100% = $125,000). Total = $20,000 + $60,000 + $125,000 = $205,000. However, the correct calculation should be: April ($100,000 * 20% = $20,000), May ($120,000 * 50% = $60,000), and June ($125,000 * 30% = $37,500). Total = $20,000 + $60,000 + $37,500 = $117,500. The provided options do not match this corrected calculation, indicating a mistake in my initial explanation. The correct approach to find the budgeted accounts receivable balance on June 30th indeed involves calculating the uncollected portions of sales from April, May, and June, but the correct total should align with one of the provided options, considering the percentages given for collection in the question.

Acorn Company's Budgeted Credit Sales Are as Follows