question archive Shown below is the sales forecast for Cooper Inc
Shown below is the sales forecast for Cooper Inc
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Shown below is the sales forecast for Cooper Inc. for the first four months of the coming year.
| January | February | March | April | |
|---|---|---|---|---|
| Cash sales | $15,000 | $24,000 | $18,000 | $14,000 |
| Credit sales | $100,000 | $120,000 | $90,000 | $70,000 |
On average, 50% of credit sales are paid for in the month of the sale, 30% in the month following sale, and the remainder are paid two months after the month of the sale. Assuming there are no bad debts, the expected cash inflow in March is: _
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the expected cash inflow in March is calculated as follows:
| ($ )March | |
|---|---|
| Cash sales | 18,000 |
| 50% of credit sales are paid for in the month of the sale ($90,000 * 50%) | $45,000 |
| 30% of credit sales are paid for in the month following the sale ($120,000 *30%) | 36,000 |
| 20% of credit sales are paid two months after the month of the sale ($100,000 *20%) | 20,000 |
| Expected cash inflow in March | 119,000 |
