Center Company makes collections on sales according to the following schedule: 40% in the month of sale 50% in the month following sale 7% in the second month following sale The following sales are expected: Expected Sales January $ 106,000 February $ 142,000 March $ 125,000 Cash collections in March should be budgeted to be: $126,330. $128,420. $121,000. $125,000.
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Center Company makes collections on sales according to the following schedule:
40% in the month of sale
50% in the month following sale
7% in the second month following sale
The following sales are expected:
| Expected Sales | |
|---|---|
| January | $ 106,000 |
| February | $ 142,000 |
| March | $ 125,000 |
Cash collections in March should be budgeted to be:
-
$126,330.
-
$128,420.
-
$121,000.
-
$125,000.
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