Problem 4: Sales budget and Cash collection schedule
Potter Inc. is preparing budget for the second quarter of 20YY.
April sales are estimated to be $400,000 of which,
$100,000 will be cash and $300,000 be sales on account.
Potter expects sales to grow 10% per month.
The company expects to collect its accounts receivableas follows:
During the month of sales:	30%
In the month after the sales, the remaining:	70%
The accounts receivable at March 31, 20YY to be collected in April:	$250,000
Required:
Use the tables below to prepare:
Sales budget and Cash collection schedule for the second quarter.
Solution:
Sales budget	April	May	June	Proforma Statement Data
	$	$	$	$
Cash sales
Credit sales
Total sales
Cash collection schedule	April	May	June	Proforma Statement Data
	$	$	$	$
Receipt from cash sales
Collection of:
Current month's sales on account
Previous month's sales on account
Total cash receipts