Cash flow of accounts receivable. Myers and Associates, a famous law firm in California, bills its clients on the first of each month. Clients pay in the following fashion:
40% pay at the end of the first month, 30% pay at the end of the second month, 20% pay at the end of the third month, 5% pay at the end of the fourth month, and 5%
default on their bills. Myers wants to know the anticipated cash flow for the first quarter of 2015 if the past billings and anticipated billings follow this same pattern. The
actual and anticipated billings are as follows:
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Fourth Quarter Actual Billings
First Quarter Anticipated Billings
Oct.
$584,000
Nov.
$479,000
Dec.
$441,000
Jan.
$502,000
Feb.
$532,000
Mar.
$579,000
What is the anticipated cash flow for January of 2015 if past bilings and anticipated billings follow this same pattern?
(Round to the nearest dollar.)