Mary Smith, Crane & James Fabricators' accounts receivable manager, has just received the company's sales budget for the first quarter. January February March Quarter Budgeted revenue $400,000 $460,000 $600,000 $1,460,000 The company makes all sales on credit. Mary recently reviewed the company's collection history and found that 72% of the sales are collected in the month of the sale, 26% of sales are collected in the month following the sale, and 2% of sales are uncollectible. The company expects to have a net accounts receivable balance of $98,200 on January 1, and this amount represents the remaining receivables from December's sales. Prepare Crane & James's cash receipts budget for the first quarter. (Enter answers in necessary fields only. Leave other fields blank. Do not enter 0.) Cash Receipts Budget
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.
Mary Smith, Crane & James Fabricators'
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January
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February
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March
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Quarter
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Budgeted revenue
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$400,000 | $460,000 | $600,000 | $1,460,000 |
The company makes all sales on credit. Mary recently reviewed the company's collection history and found that 72% of the sales are collected in the month of the sale, 26% of sales are collected in the month following the sale, and 2% of sales are uncollectible. The company expects to have a net accounts receivable balance of $98,200 on January 1, and this amount represents the remaining receivables from December's sales.
Prepare Crane & James's
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Cash Receipts Budget
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January
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February
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March
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Total Cash Receipts
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Uncollectible
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December credit sales
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$enter a dollar amount | $enter a dollar amount | $enter a dollar amount | $enter a dollar amount | $enter a dollar amount | |||
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January sales
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enter a dollar amount | enter a dollar amount | enter a dollar amount | enter a dollar amount | enter a dollar amount | |||
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February sales
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enter a dollar amount | enter a dollar amount | enter a dollar amount | enter a dollar amount | enter a dollar amount | |||
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March sales
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enter a dollar amount | enter a dollar amount | enter a dollar amount | enter a dollar amount | enter a dollar amount | |||
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Totals
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$enter a total amount | $enter a total amount | $enter a total amount | $enter a total amount | $enter a total amount |
Determine the Net Accounts Receivable at the end of the quarter. Assume that there are no outstanding accounts receivable and allowance for doubtful accounts balances at the beginning of December for the prior year.
| Net Accounts Receivable | $enter net accounts receivable amount in dollars |
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