Question

Shadee Corp. expects to sell 500 sun visors in May and 410 in June. Each visor sells for $13. Shadee’s beginning and ending finished goods inventories for May are 75 and 40 units, respectively. Ending finished goods inventory for June will be 50 units.

It expects the following unit sales for the third quarter:      

July	500
August	490
September	440

Sixty percent of Shadee’s sales are cash. Of the credit sales, 54 percent is collected in the month of the sale, 40 percent is collected during the following month, and 6 percent is never collected.

Required:

Calculate Shadee’s total cash receipts for August and September. (Do not round your intermediate calculations. Round your answers to the nearest whole dollar.)

Answer 1

Answer:

Total cash receipts for August and September = $11,925

Workings: