Reference no: EM132904089

Fresplanade Co. had the following historical collection pattern for its credit sales:

• 70% collected in the month of sale
• 15% collected in the first month after month of sale
• 9% collected in the second month after month of sale
• 5% collected in the third month after month of sale
• 1% uncollectible

The sales on open account (credit sales) have been budgeted for the last six months of the year as shown below:

July $89,000

August $101,000

September $113,000

October $125,000

November $137,000

December $119,000

Problem 1: The estimated total cash collections by Fresplanade Co. during December from accounts receivable is:

Multiple Choice

Option 1: $117,990.
Option 2: $173,050.
Option 3: $146,350.
Option 4: $129,870
Option 5: $120,750

Problem 2: Which of the following is not a benefit of using a lean manufacturing system?

Multiple Choice

Option 1: Products, on average, have less variety.
Option 2: Average inventory is decreased.
Option 3: Production operations are linked in a smooth, uninterrupted flow.
Option 4: Productivity is improved.
Option 5: Lead times are reduced.