The LaGrange Corporation had the following budgeted sales for the first half of the current year:
The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled:
The accounts receivable balance on January 1 of the current year was $70,000, of which $50,000 represents uncollected December sales and $20,000 represents uncollected November sales.
-The total cash collected during January by LaGrange Corporation would be:

Question

The LaGrange Corporation had the following budgeted sales for the first half of the current year:
  The company is in the process of preparing a cash budget and must determine the expected cash collections by month. To this end, the following information has been assembled:
  The accounts receivable balance on January 1 of the current year was $70,000, of which $50,000 represents uncollected December sales and $20,000 represents uncollected November sales.
-The total cash collected during January by LaGrange Corporation would be:

Quizplus · Accepted Answer

Cash collections for January:
 11ea7761_17af_edf4_81a5_913beeae1d01_TB2580_00 *Accounts receivables representing December credit sales
= $50,000 = (30% + 10%) × December credit sales
December credit sales = $50,000 ÷ (30% + 10%) = $125,000

The LaGrange Corporation Had the Following Budgeted Sales for the First