Question

Serdnic Reeds, a manufacturer of saxophone, oboe, and clarinet reeds, has projected sales to be $ 896,000 in October, $ 966,000 in November, $ 1,065,000 in December, and $ 934,000 in January. Serdnic’s sales are 20% cash and 80% on credit. The company’s collection history indicates that credit sales are collected as follows:
25% in the month of the sale
60% in the month after the sale
14% two months after the sale
1% are never collected

Requirements
1. Prepare a sales budget for all four months, showing the breakdown between cash and credit sales.
2. Prepare a cash collection budget for December and January. Round all answers up to the nearest dollar.



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  • CreatedAugust 27, 2014
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