(Answered) Problem -july august september totalbudgeted sales all on

Accounting

Problem -

July August September Total

Budgeted sales (all on account) $600,000 $900,000 $500,000 $2,000,000

From past experience, the company has learned that 20% of a month's sales are collected in the month of sale, another 70% are collected in the month following sale, and the remaining 10% are collected in the second month following sale. Bad debts are negligible and can be ignored. May sales totaled $430,000, and June sales totaled $540,000.

Required:

1. Prepare a schedule of expected cash collections from sales, by month and in total, for the third quarter.

2. Assume that the company will prepare a budgeted balance sheet as of September 30. Compute the accounts receivable as of that date.

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