Answer:
b. are $220.
Explanation:
Given that firm makes 20 percent of sales for cash and collects the balance one month following the sale. It means that cash collected in July will consist of 20% of the sales in the month of July and 80% of the sales in the previous month of June.
As such, if projected sales in May, June, and July of $100, $200, and $300, respectively, the firm's total cash receipts in July
= (20% × $300) + (80% × $200)
= $60 + $160
= $220
Answer:
B) are $220.
Explanation:
Month total sales 20% cash balance collection total
May $100 $20 $0 $20
June $200 $40 $80 $120
July $300 $60 $160 $220
The firm will collect 20% of its July sales = $60, and 80% of its June sales = $160, for a total of $220
