Question: Calculating Cash Collections. The following is the sales budget for Tesoro Azul, Inc., for the first quarter of 2016.
January February March
Sales Budget %153,000 $169,000 $181,000
Credit sales are collected as follows:
65 percent in the month of the sale
20 percent in the month after the sale
15 percent in the second month after the sale
The accounts receivable balance at the end of the previous quarter was $97,000 ($71,000 of which was uncollected December sales).
a. Compute the sales for November.
b. Compute the sales for December.
c. Compute the cash collections from sales for each month from January through March.