Ace Inc shows a cash balance of $24,000 on January 1, 2008. The expected sales (in units) of its product by month for the first quarter are:
|
January
|
600,000
|
|
February
|
400,000
|
|
March
|
500,000
|
Sales are collected 75% in the month of sale and 25% in the month following the sale. Actual sales in units by month for the previous quarter follow:
|
October
|
550,000
|
|
November
|
700,000
|
|
December
|
800,000
|
Ace sells its product for $2 each
Question:
a)Determine the expected unit and dollar sales by month for the first quarter.
b) Determine the expected cash receipts by month for the first quarter.
c) Determine the anticipated accounts receivable balance by month for the first quarter