Marker Products Inc Sells All of Its Products on Credit

Essay

Marker Products Inc sells all of its products on credit.The company expects to collect 65 percent of sales in the quarter of sale and 35 percent the quarter following the sale.Accounts receivable at the end of last year totaled $3 million,all of which will be collected in the first quarter of the coming year.Marker's sales budget shows the following projected sales revenues:
$$\begin{array} { r r } \text { Quarter 1: } & \$ 8,800,000 \\\text { Quarter 2: } & \$ 11,000,000 \\\text { Quarter 3: } & \$ 11,440,000 \\\text { Quarter 4: } & \$ 10,560,000\end{array}$$
Prepare a budget for cash collections from sales for each of the four quarters.