The treasurer of Simmons Corporation, a newly formed software company is trying to ascertain Simmons cash flows for the next three months. Expected sales are: April 300 May 360 and June 500 50% of sales are made for cash. Simmons expects to receive 25% in the month following the sale and 20% in the second month following the sale. The remaining 5% are expected to be un-collectible. The gross margin is 20%, and purchases are made one month prior to sale. Purchases are paid one month after being received. The cash inflows in June from sales will be:

$250
$245
$220
None of the above.

Answer rating: 100% (QA)

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