The following is the sales budget for Uptown Rentals,Inc.for the first quarter of 2013: Credit sales are collected as follows:
60 percent in the month of sale
32 percent in the month after the sale
8 percent in the second month after the sale
The accounts receivable balance at the end of the previous quarter was $87,040 ($73,600 of which was uncollected December sales).How much did the firm collect in the month of February?

Question

The following is the sales budget for Uptown Rentals,Inc.for the first quarter of 2013:  Credit sales are collected as follows:
60 percent in the month of sale
32 percent in the month after the sale
8 percent in the second month after the sale
The accounts receivable balance at the end of the previous quarter was $87,040 ($73,600 of which was uncollected December sales).How much did the firm collect in the month of February?

Quizplus · Accepted Answer

February collections = 0.60($148,000) + 0.32($136,000) + [0.08/(0.08 + 0.32)] [$73,600] = $147,040

The Following Is the Sales Budget for Uptown Rentals,Inc