Kennedy Enterprises has budgeted sales for the months of September and October at $120,000 and $150,000,respectively.Monthly sales are 70% credit and 30% cash.Of the credit sales,20% are collected in the month of sale and 80% are collected in the following month.What are the October cash collections from customers?

Question

Quizplus · Accepted Answer

A)
Sept.Sales $120,000 × 70% = 84,000 × 80% = $67,200
Oct.Sales 150,000 × 70% = 105,000 × 20% = 21,000
Total collections on account
Cash sales $150,000 × 30% = 45,000
Total Cash collected $133,200

Kennedy Enterprises Has Budgeted Sales for the Months of September