Question

The budget director of Heather’s Florist has prepared the following sales budget. The company had $350,000...

The budget director of Heather’s Florist has prepared the following sales budget. The company had $350,000 in accounts receivable on July 1. Heather’s Florist normally collects 100 percent of accounts receivable in the month following the month of sale.

Required

  1. Complete the schedule of cash receipts by filling in the missing amounts.

  2. Determine the amount of accounts receivable the company will report on its third quarter pro forma balance sheet.

1.

July August September
Sales Budget
Cash sales $67,000 $67,000 $76,000
Sales on account 93,000 99,000 136,600
Total budgeted sales $160,000 $166,000 $212,600
Schedule of Cash Receipts
Current cash sales
Plus: Collections from accounts receivable
Total budgeted collections $417,000 $160,000

$175,000

2.

Accounts Receivable   

Homework Answers

Answer #1

1. Schedule of cash receipts

July August September
Current cash sales $    67,000 $    67,000 $         76,000
Plus: Collections from accounts receivable $ 350,000 $    93,000 $         99,000
Total budgeted collection $ 417,000 $ 160,000 $       175,000

Company will collect 100% of on account sales in next month only. so account receivable balance will be current month on account sales. so answer is: $136,600

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