Question:
The October 1, 2010, Accounts Receivable balance for Darin Landscaping is $632,500. Of that balance, $480,000 represents remaining accounts receivable from September billings. The normal collection pattern for the firm is 20 percent of billings in the month of service, 55 percent in the month after service, and 22 percent in the second month following service. The remaining billings are uncollectible. October billings are expected to be $750,000.
a. What were August billings for Darin Landscaping?
b. What amount of September billings is expected to be uncollectible?
c. What are the firm's projected cash collections in October?