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Ruiz Co.'s budget includes the following credit sales for the current year: September, $145,000; October, $136,000; November, $120,000; December, $157,000. Credit sales are collected as follows: 15% in the month of sale, 50% in the first month after sale, and 35% in the second month after sale. How much cash can the company expect to collect in December as a result of current and past credit sales

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Cricetus

Answer:

The total collection in December is "131150".

Explanation:

The given values are:

Credit sales,

  • September: $145,000
  • October: $136,000
  • November: $120,000
  • December: $157,000

Now,

Credit sales in December will be:

= [tex]157,000\times 15 \ percent[/tex]

= [tex]157000\times 0.15[/tex]

= [tex]23550[/tex]

Credit sales in November will be:

= [tex]120000\times 50 \ percent[/tex]

= [tex]120000\times 0.5[/tex]

= [tex]600000[/tex]

Credit sales in October will be:

= [tex]136000\times 35 \ percent[/tex]

= [tex]136000\times 0.35[/tex]

= [tex]47600[/tex]

hence,

The total collection will be:

= [tex]23550+60000+47600[/tex]

= [tex]131150[/tex]

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