Solution-Determine the expected cash collections during May

Determine the expected cash collections during May

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Question - Dante Manufacturing has a cash balance of P8,000 on August 1 of the current year. The company's controller forecast the following cash receipts and cash disbursements for the upcoming two months of activity.

	Purchases	Sales
January	P 142,000	P 172,000
February	148,000	166,000
March	136,000	165,000
April	154,000	178,000
May	160,000	166,000

Customers pay 60% of their balances in the month of sale, 30% in the month following sale, and 10% in the second month following sale. The company pays all invoices in the month following purchase and takes advantage of a 3% discount on all amounts due. Cash payments for operating expenses in May will be P119,500; Crispin's cash balance on May 1 was P127,800.

Required - Determine the following:

1. Expected cash collections during May.

2. Expected cash disbursements during May.

3. Expected cash balance on May 31.

Reference no: EM132558710

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Determine the expected cash collections during May

Reference no: EM132558710

Reference no: EM132558710

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