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Question 2. (cash receipts from sales) Budgeted sales revenue for the coming five months is as...

Question 2. (cash receipts from sales)

Budgeted sales revenue for the coming five months is as follows:

Month Sales revenue
August $160,000
September $155,000
October $155,000
November $115,000
December $180,000

You estimate that you will collect 35% of sales revenue in the month of sale, 35% in the following month, 25% two months after the sale, and the remaining 5% three months after the sale.

Required:

Compute budgeted cash inflows for November and December.
   November = $
   December = $
(Hint: pay attention to the timing, e.g. "35% is collected in the following month" means 35% of August revenue is collected in September, i.e., cash receipts (inflows) for September include 35% of previous month's sales revenue.)

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Answer #1

August September October November December 56000 56000 54250 Credit sales collection: August September October November Decem

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