Answered

IDNLearn.com: Your reliable source for finding precise answers. Ask anything and receive prompt, well-informed answers from our community of experienced experts.

Crane Company estimates its sales at 80000 units in the first quarter and that sales will increase by 8000 units each quarter over the year. They have, and desire, a 25% ending inventory of finished goods. Each unit sells for $25. 40% of the sales are for cash. 70% of the credit customers pay within the quarter. The remainder is received in the quarter following sale. Cash collections for the third quarter are budgeted at

Sagot :

Facundobuzzettiidn

Answer:

Total cash collection Third Quarter= $2,364,000

Explanation:

Giving the following information:

40% of the sales are for cash.

70% of the credit customers pay within the quarter.

The remainder is received in the quarter following the sale.

Sales:

Q2= 88,000*25= 2,200,000

Q3= 96,000*25= 2,400,000

Selling price per unit= $25

Cash collection Third Quarter:

Sales in cash= 2,400,000*0.4= 960,000

Sales on account third quarter= (2,400,000*0.6)*0.7= 1,008,000

Sales on account second quarter= (2,200,000*0.6)*0.3= 396,000

Total cash collection Third Quarter= $2,364,000

Thank you for joining our conversation. Don't hesitate to return anytime to find answers to your questions. Let's continue sharing knowledge and experiences! IDNLearn.com is committed to providing the best answers. Thank you for visiting, and see you next time for more solutions.