A company's past experience indicates that 60% of its credit sales are collected in the month of sale, 30% in the next month, and 5% in the second month after the sale; the remainder is never collected. Budgeted credit sales were:
The cash inflow in the month of March is expected to be:

Question

A company's past experience indicates that 60% of its credit sales are collected in the month of sale, 30% in the next month, and 5% in the second month after the sale; the remainder is never collected. Budgeted credit sales were:
 The cash inflow in the month of March is expected to be:

Quizplus · Accepted Answer

The cash inflow for the month of March is expected to be $90,400 (($120,000 x .60) + (48,000 x .30) + (80,000 x .05)).

A Company's Past Experience Indicates That 60% of Its Credit