Budgeted Cash Collections In an effort to improve cash collection, Suburban Medical Clinic offers terms...
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Budgeted Cash Collections In an effort to improve cash collection, Suburban Medical Clinic offers terms of 2/10, n/30, with a 5% discount on patient payments made with cash. Suburban estimates its total billings for the second calendar quarter of the year as follows: April, $600,000; May, $720,000; and June, $870,000. Historically, Suburban has had the following patient collection patterns:
In month of sale:
Cash at time of sale
25%
On account during the discount period
20%
On account after the discount period
10%
In month following sale:
On account after the discount period
25%
In second month following sale:
On account after discount period
15%
Average portion uncollectible
5%
100%
What would be Suburbans budgeted total cash collections for June?
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