Salich Manufacturing Corporation has provided the following sales budget information: Cash sales are normally 40% of total sales and the credit sales are expected to be collected in their entirety in the month following the month of sale.The amount of cash expected to be received from customers in September is:

Question

Salich Manufacturing Corporation has provided the following sales budget information:  Cash sales are normally 40% of total sales and the credit sales are expected to be collected in their entirety in the month following the month of sale.The amount of cash expected to be received from customers in September is:

Quizplus · Accepted Answer

The total sales budget for September is $142,500 ($105,000 + $37,500). Since cash sales are normally 40% of total sales, the cash sales for September would be 40% of $142,500, which is $57,000. Furthermore, credit sales are expected to be collected in the month following the month of sale, so they are not part of the cash expected to be received in September. Therefore, the best choice is C, $57,000.

Salich Manufacturing Corporation Has Provided the Following Sales Budget Information