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Pitkins, Company collects 20% of a month's sales in the month of sale, 70% in the month following sale, and 6% in the second month following sale. The remainder is uncollectible. Budgeted sales for the next four months are:
January February March April
Budgeted sales..... $200,000 $300,000 $350,000 $250,000
Problem 1: Cash collections in April are budgeted to be:
a. $321,000
b. $313,000
c. $320,000
d. $292,000
Prepare the adjusting journal entry that should be prepared to reflect the reconciling items.
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