16. Callarman Company projects the following sales:
(Click on the icon to view the projected sales.)
Callarman collects sales on account in the month after the sale. The Accounts Receivable balance on January 1 is $12,100, which represents December's sales on account. Callarman projects the following cash receipts from customers:
(Click on the icon to view the cash receipts from customers.)
Recalculate cash receipts from customers if total sales remain the same but cash sales are only 5% of the total.
Begin by computing the cash sales and sales on account for each month if cash sales are only 5% of the total.
January
February
March
Cash sales (5%)
Sales on account (95%)
Total sales
$\qquad34,000
$\qquad24,000
$\qquad23,000
Now, recalculate cash receipts from customers for each month if cash sales are only 5% of the total.
Cash receipts from cash sales
Cash receipts from sales on account
Total cash receipts from customers
January
February
March
January
February
March
Cash receipts from cash sales
$\qquad3,400
$\qquad2,400
$\qquad2,300
Cash receipts from sales on account
$\qquad12,100
$\qquad30,600
$\qquad21,600
Total cash receipts from customers
$\qquad15,500
$\qquad33,000
$\qquad23,900
