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 are the budgeted cash collections from customers for the month of June?

Question

Quizplus · Accepted Answer

For June, the collections include 30% of June sales, 50% of May sales, and 20% of April sales. Calculations: June sales ($125,000 * 30% = $37,500) + May sales ($120,000 * 50% = $60,000) + April sales ($100,000 * 20% = $20,000) = $117,500.

Acorn Company's Budgeted Credit Sales Are as Follows