Yung Reeds, a manufacturer of saxophone, oboe, and clarinet reeds, has projected sales to be $892,000 in October, $954,000 in November,$1,040,000 in December, and $928,000 in January. Yung's sales are 25% cash and 75% credit. The company's collection history indicates that creditsales are collected as follows:20% in the month of the sale65% in the month after the sale8% two months after the sale7% are never collectedRequirements1. 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.Yung ReedsBudgeted Cash Collections from CustomersFor the Months of December and JanuaryDecemberCash salesCollection of credit sales:20% of current month credit sales65% of prior month credit sales8% of credit sales two months agoTotal collection of credit salesTotal cash collections$$260,000 $156,000465,07553,520934,595 $January232,000139,200507,00057,240935,440

Sales budget and cash collection budget is part of budgeting. It is preparing for the future period.…

Answered: Yung Reeds, a manufacturer of…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 10PA: Sports Socks has a policy of always paying within the discount period and each of its suppliers...

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Halifax Shoes has 30% of its sales in cash and the remainder on credit. Of the credit sales, 65% is collected in the month of sale, 25% is collected the month after the sale, and 5% is collected the second month after the sale. How much cash will be collected in August if sales are estimated as $75,000 in June, $65,000 in July, and $90,000 in August?
Sports Socks has a policy of always paying within the discount period and each of its suppliers provides a discount of 2% if paid within 10 days of purchase. Because of the purchase policy, 85% of its payments are made in the month of purchase and 15% are made the following month. The direct materials budget provides for purchases of $129,582 in November, $294,872 in December, $239,582 in January, and $234,837 in February. What is the balance in accounts payable for January 31, and February 28?
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Ed's Waterbeds has made the following sales projections for the next six months. All sales are credit sales. March $ 12,000 June $ 14,000 April 16,000 July 17,000 May 10,000 August 18,000 Sales in January and February were $13, 500 and $13,000 respectively. Experience has shown that 10 percent of total sales are uncollectible, 30 percent are collected in the month of sale, 40 percent are collected in the following month, and 20 percent are collected two months after sale. a. Prepare a monthly cash receipts schedule for the firm for March through August. Ed's Waterbeds Cash Receipts Schedule January February March April May June July August Sales $ $ $ $ $ $ $ $ Collections of current sales Collections of prior month's sales Collections of sales 2 months earlier Total cash receipts $ $ $ $ $$b. Of the sales expected to be made during the six months from March to August, how much will still be uncollected at the end of August? How much of this is expected to be collected later? Amount…
Besoluck company has sales of P480,000 and P450,000 for September and October respectively. Of the total Sales, 1% is returned. 75% of the total sales account for credit sales and 20% of credit sales avail of the discount of 2%. The company is able to collect 40% of credit sales in the month of sales and 60% is collected in the following month. During October, the company has written off P20,000 of worthless accounts but had collected P13,000 from an account previously written off. The company uses, 10% percent of receivables for estimating doubtful accounts. What amount is debited to doubtful accounts expense if the balance of the allowance for doubtful accounts on Oct 1 is P7,350.50?
Dolman's, an elite clothier, expects its November sales to be 30% higher than its October sales of $200,000. Purchases were $100,000 in October and are expected to be $150,000 in November. All sales are on credit and are collected as follows: 30% in the month of thé sale and 70% in the following month. Purchases are paid 25% in the TL
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The management of Huges Co. estimates that credit sales for January, February, March and April will be $180,000, $210,000, $230,000, and $160,000,respectively. Experience has shown that collections are made as follows:In month of sale 25%In first month after sale 60%In second month after sale 10% The collections from customers in march is _________? show solution

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