Frankie's Chocolate Co. reports the following information from its sales budget: Expected Sales:
$$\begin{array} { l r r }
\text { July } & \$ 90,000 \
\text { August } & 104,000 \
\text { September } & 120,000
\end{array}$$ Cash sales are normally 25% of total sales and all credit sales are expected to be collected in the month following the date of sale. The total amount of cash expected to be received from customers in September is:

Question

Frankie's Chocolate Co. reports the following information from its sales budget: Expected Sales:
$$\begin{array} { l r r } 
\text { July } & \$ 90,000 \
\text { August } &  104,000 \
\text { September } & 120,000
\end{array}$$  Cash sales are normally 25% of total sales and all credit sales are expected to be collected in the month following the date of sale. The total amount of cash expected to be received from customers in September is:

Quizplus · Accepted Answer

Total expected sales = $432,000
Cash sales = 25% of total sales = 0.25 x $432,000 = $108,000
Total credit sales = $432,000 - $108,000 = $324,000
Expected cash collection in September = 0
All credit sales are expected to be collected in the month following the date of sale, so no credit sales are expected to be collected in September. Therefore, the total amount of cash expected to be received from customers in September is equal to the amount of cash sales, which is $108,000.

Frankie's Chocolate Co July $90,000 August 104,000 September 120,000\begin{array} { l r r } \text { July } & \$ 90,000 \\\text { August } & 104,000 \\\text { September } & 120,000\end{array} July August September ​$90,000104,000120,000​

Frankie's Chocolate Co $\begin{array} { l r r } \text { July } & \$ 90,000 \\\text { August } & 104,000 \\\text { September } & 120,000\end{array}$