1. Assume a company is preparing a budget for its first two months of operations. During the...
Question:
1. Assume a company is preparing a budget for its first two months of operations. During the first and second months it expects credit sales of $42,000 and $62,000, respectively. The company expects to collect 35% of its credit sales in the month of the sale and the remaining 65% in the following month. What amount of accounts receivable would the company report in its balance sheet at the end of the first month?
Multiple Choice
$20,100
$47,600
$21,000
$67,300
2. Assume a company is preparing a budget for its first two months of operations. During the first and second months it expects credit sales of $48,000 and $70,000, respectively. The company expects to collect 35% of its credit sales in the month of the sale and the remaining 65% in the following month. What is the expected cash collections from credit sales during the first month?
Multiple Choice
$31,200
$42,250
$16,800
$25,200
