The forecasted sales pertain to Risco, Inc.:
Month Sales
January $400,000
February 500,000
March 300,000
April 200,000
Collection pattern:
50 percent in month of sale
50 percent in month following the sale
Accounts Receivable (December 31) $70,000
Finished Goods Inventory (December 31) 80,000
The company has a selling price of $10 per unit and expects to maintain ending inventories equal to 20 percent of the next month's sales.
How much cash does Risco expect to collect in February?