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Camellia, a merchandising​ company, has provided the following extracts from their budget for the first quarter of the forthcoming​ year: Jan Feb March Sales ​(25​% ​cash) $ 400 comma 000.00 $ 600 comma 000.00 $ 900 comma 000.00 The company collects 70​% of credit sales in the same month and the balance in the next month. Calculate the collections from the customers for the month of February.

Answer :

ofentsemaphalla

Answer:

555 000 US$

Explanation:

                Cash sales(25%)                            Credit sales(75%)

January  (400,000*25%)=100000                    (400,000-100000)=300,000

February  (600,000*25%)=150,000            (600,000-150,000)=450,000

Customer collections to the month of February.

= $150,000 + ($450,000 * 0.7) + ($300,000*0.3)

(Balance collections = (100 - 70) = 30%)

ogorwyne

The calculated collections from the customers is $555000

In January there was 25% cash sales

400000*25% = 100000

Credit sales = 400000-100000

= 300000

In February there was also 25% cash sales

600000*25% = 150000

Credit sales = 600000-150000

= $450000

The collection from February

150000+(450000*0.7)+(300000*0.3)

= 315000+150000+90000

= $555000

In conclusion the collections from the customers for the month of February is $555000

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