Preparation of its cash budget

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Reference no: EM13953415

A company is formulating its plans for the coming year, including the preparation of its cash budget. Historically, the company's sales are 20% cash. The remaining sales are on credit with the following collection pattern:

Collections on Account	Percentage
In the month of sale	38%
In the month following the sale	60%
Uncollectible	2%

Sales for the first 5 months of the coming year are forecast as follows:

January	$ 3,498,000
February	3,798,000
March	3,598,000
April	3,998,000
May	4,198,000

For the month of April, the total cash receipts from sales and collections on account would be:

$3,742,032.

$4,477,640.

$4,685,440.

$3,534,232

Reference no: EM13953415

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