16 Assume a company is preparing a budget for its first two months of operations. During the first and second months it expects credit sales of $48,000 and $64,000, respectively. The company expects to collect 60% of its credit sales in the month of the sale, 35% in the following month, and 5% is deemed uncollectible. What amount of cash collections from credit sales would the company include in its cash budget for the second month? Multiple Choice О $22,400 О $58,400 О $38,400 $55,200

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter8: Budgeting For Planning And Control
Section: Chapter Questions
Problem 34E: A companys sales for the coming months are as follows: About 20 percent of sales are cash sales, and...
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16
Assume a company is preparing a budget for its first two months of operations. During the first and second months it expects credit sales of $48,000 and
$64,000, respectively. The company expects to collect 60% of its credit sales in the month of the sale, 35% in the following month, and 5% is deemed
uncollectible. What amount of cash collections from credit sales would the company include in its cash budget for the second month?
Multiple Choice
О
$22,400
О
$58,400
О
$38,400
$55,200
Transcribed Image Text:16 Assume a company is preparing a budget for its first two months of operations. During the first and second months it expects credit sales of $48,000 and $64,000, respectively. The company expects to collect 60% of its credit sales in the month of the sale, 35% in the following month, and 5% is deemed uncollectible. What amount of cash collections from credit sales would the company include in its cash budget for the second month? Multiple Choice О $22,400 О $58,400 О $38,400 $55,200
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