Davis and Davis have expected sales of $490, $465, $450, and $570 for the months of January through April, respectively. The accounts receivable period is 28 days. What is the accounts receivable balance at the end of March? Assume a year has 360 days.
March ending receivables = (28/30) $450 = $420
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77.
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The Athletic Sports Store has a beginning receivables balance on January 1 of $410. Sales for January through April are $440, $480, $690, and $720, respectively. The accounts receivable period is 60 days. How much did the firm collect in the month of April? Assume a year has 360 days.
April collections = February sales = $480
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78.
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Breakwater Aquatics has a 45 day accounts receivable period. The estimated quarterly sales for this year, starting with the first quarter, are $6,800, $7,100, $8,200, and $6,400, respectively. What is the accounts receivable balance at the beginning of the third quarter? Assume a year has 360 days.
A/R Begin Q3 = A/R End Q2 = (45/90) $7,100 = $3,550
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79.
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The Dog House expects sales of $560, $650, $630, and $610 for the months of May through August, respectively. The firm collects 20 percent of sales in the month of sale, 70 percent in the month following the month of sale, and 8 percent in the second month following the month of sale. The remaining 2 percent of sales is never collected. How much money does the firm expect to collect in the month of August?
August collections = 0.20($610) + 0.70($630) + 0.08($650) = $615
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