Distribution Corporation collects 40% of a month's sales in the month of sale, 55% in the month following sale, and 5% in the second month following sale. Budgeted sales for the upcoming four months are:
April budgeted sales $100,000
May budgeted sales $150,000
June budgeted sales $230,000
July budgeted sales $180,000
The amount of cash that will be collected in July is budgeted to be
A) $72,000.
B) $179,500.
C) $206,000.
D) $195,500.
C
Explanation: C)
May Sales $150,000 × 5% = $7,500
June Sales 230,000 × 55% = 126,500
July Sales 180,000 × 40% = 72,000
Total $206,000
Business
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