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Budgeted sales and cash collections for Cherry Corporation for Quarter 1 are listed below: Cash...

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Accounting

Budgeted sales and cash collections for Cherry Corporation for Quarter 1 are listed below:

Cash Sales

Credit Sales

Total Sales

January

$125,000

$400,000

$525,000

February

$100,000

$260,000

$360,000

March

$85,000

$195,000

$280,000

The company is in the process of preparing a cash budget and must determine the expected cash collections.

Collections on credit sales:

Month of sale 60%

Month after sale 30%

2nd month after sale 10%

The accounts receivable balance on January 1 is $175,000, of which $75,000 represents uncollected December sales and $100,000 represents uncollected November sales

11. The total cash collected in March would be:

A.$328,500

B.$178,500

C.$235,000

D.$320,000

E.None of the above

12. The accounting receivable balance as of the end of January would be:

A.$331,500

B.$178,750

C.$210,000

D.$240,000

E.None of the above

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