Oakton Furniture provided the following information relevant to its sales for December Year 1 and the first quarter of Year 2: $\begin{array}{|l|l|r|r|r|}
\hline& \text { Dec. Year } 1 &\text { Jan. Year } 2 &\text { Feb. Year } 2 & \text { Mar. Year } 2 \
\hline & \text { (Actual)} & \text { (Budgeted) }& \text { (Budgeted) }& \text { (Budgeted) } \
\hline \text {Credit sales } &\$ 120,000 & \$ 280,000 & \$ 310,000 & \$ 220,000 \
\hline \text { Cash sales } &\$ 20,000 & \$ 50,000 & \$ 60,000 & \$ 24,000 \
\hline
\end{array}$ Based on the company's collection history,42% of credit sales are collected in month of sale and the remainder is collected in the following month.Total budgeted cash receipts in February are expected to be:
A) $60,000.
B) $162,400.
C) $352,600.
D) $228,000.

Question

Oakton Furniture provided the following information relevant to its sales for December Year 1 and the first quarter of Year 2: $\begin{array}{|l|l|r|r|r|}
\hline&  \text { Dec. Year } 1 &\text { Jan. Year } 2 &\text { Feb. Year } 2 & \text { Mar. Year } 2 \
\hline & \text { (Actual)} & \text { (Budgeted)  }& \text { (Budgeted)  }& \text { (Budgeted)  } \
\hline \text {Credit sales } &\$ 120,000 & \$  280,000 & \$ 310,000 & \$ 220,000 \
\hline \text {    Cash sales } &\$ 20,000 & \$  50,000 & \$  60,000 & \$  24,000 \
\hline
\end{array}$ Based on the company's collection history,42% of credit sales are collected in month of sale and the remainder is collected in the following month.Total budgeted cash receipts in February are expected to be:
A) $60,000.
B) $162,400.
C) $352,600.
D) $228,000.

Quizplus · Accepted Answer

In February, cash receipts include 42% of February's credit sales ($310,000 * 0.42 = $130,200), 58% of January's credit sales ($280,000 * 0.58 = $162,400), and February's cash sales ($60,000). Total = $130,200 + $162,400 + $60,000 = $352,600.

Oakton Furniture Provided the Following Information Relevant to Its Sales