Markham Company has completed its sales budget for the first quarter of Year 2. Projected credit sales for the first four months of the year are shown below: The company's past records show collection of credit sales as follows: 40% in the month of sale and the balance in the following month. The total cash collection from receivables in March is expected to be:

Question

Markham Company has completed its sales budget for the first quarter of Year 2. Projected credit sales for the first four months of the year are shown below:  The company's past records show collection of credit sales as follows: 40% in the month of sale and the balance in the following month. The total cash collection from receivables in March is expected to be:

Quizplus · Accepted Answer

March collections = (February sales × Percent collected in month following month of sale) + March sales × Percent collected in month of sale
March collections = ($36,000 × 60%) + ($45,000 × 40%) = $21,600 + $18,000 = $39,600

Markham Company Has Completed Its Sales Budget for the First