Lopez Inc. found that about 35 percent of its sales during the month were for cash. Lopez has the following accounts receivable payment experience:
Percent paid in the month of sale.......... 25
Percent paid in the month after the sale ......... 68
Percent paid in the second month after the sale ..... 5
Lopez’s anticipated sales for the next few months are as follows:
April ...... $ 200,000
May ...... 240,000
June ...... 230,000
July ...... 240,000
August ..... 250,000
Required:
1. Calculate credit sales for May, June, July, and August.
2. Prepare a schedule of cash receipts for July and August.