AlliCat Skateboards Inc. makes all sales on account, subject to the following collection pattern:30% are collected in the month of sale; 60% are collected in the first month after sale; and 10% are collected in the second month after sale. If sales for October, November, and December were $50,000, $40,000, and $60,000, respectively, what was the budgeted receivables balance on December 31?

Question

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The budgeted receivables balance on December 31 includes 10% of October sales ($5,000), 60% of November sales ($24,000), and 70% of December sales ($42,000), totaling $46,000.