Question

Seventy percent of Pitkin Corporation's sales are collected in the month of sale, 20% in the month following sale, and 10% in the second month following sale. The following are budgeted sales data for the company: January February March April Budgeted sales $200,000 $300,000 $350,000 $250,000 ​ Total budgeted cash collections in April would be: Question 2 options: A) $175,000 B) $70,000 C) $30,000 D) $275,000

Answer 1

Answer:

Hence, the  Total budgeted cash collections in April would be $275,000

Thus, the correct option is D $275,000

Explanation:

Budgeted Sales : The budgeted sales is that type of sale which is to be achieved in the future.

The computation of Total budgeted cash collections in April would be shown below

= 70% of April Month + 20% of march month + 10% of February month

= 70 % × $250,000 + 20% × $350,000  + 10%  × $300,000

= $175,000 + $70,000 + $30,000

= $275,000

Hence, the  Total budgeted cash collections in April would be $275,000

Thus, the correct option is D $275,000