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The sales budget for perrier

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Reference no: EM13322354

Cash Receipts
The sales budget for Perrier Inc. is forecasted as follows:
Month
Sales Revenue


May $100,000
June 170,000
July 180,000
August 120,000



To prepare a cash budget, the company must determine the budgeted cash collections from sales. Historically, the following trend has been established regarding cash collection of sales:

  • 60 percent in the month of sale.
  • 20 percent in the month following sale.
  • 15 percent in the second month following sale.
  • 5 percent uncollectible.


The company gives a 1 percent cash discount for payments made by customers during the month of sale. The accounts receivable balance on April 30 is $27,000, of which $6,000 represents uncollected March sales and $21,000 represents uncollected April sales. Prepare a schedule of budgeted cash collections from sales for May, June, and July. Include a three-month summary of estimated cash collections.

Perrier, Inc.
Schedule of Budgeted Cash Collections
Quarterly by Months

May

June

July

Total


Total Cash receipts:

Reference no: EM13322354

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