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Question - ABC Ltd is a retailer of ladies' fashion and has the following historical collection pattern for its credit sales:
65 percent collected in the month of sale
15 percent collected in the first-month after-sale
10 percent collected in the second-month after-sale
5 percent collected in the third-month after-sale
5 percent uncollectable.
The credit sales have been budgeted for the last seven months of the year, as shown below:
June $225,000
July 240,000
August 250,000
September 260,000
October 280,000
November 300,000
December 225,000
Calculate the estimated total cash receipts during December from credit sales.
a. None of the answers given
b. $290000
c. $244,000
d. $260,000
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