Atlanta Company expects June sales to be $20,000.Of these sales,credit sales are expected to be $12,000.Collection of credit sales are 50% in the month of sale,40% in the month following sale and 5% two months following sale.The remaining 5% is uncollectible.________ is the expected cash collection in June from June sales.

Question

Quizplus · Accepted Answer

The expected cash collection in June from June sales includes 50% of the credit sales collected in the month of sale ($12,000 * 50% = $6,000) plus the cash sales ($20,000 - $12,000 = $8,000). Therefore, the total expected cash collection in June is $6,000 + $8,000 = $14,000.

Atlanta Company Expects June Sales to Be $20,000