Rich Company's Experience Shows That 20% of Its Sales Are

Essay

Rich Company's experience shows that 20% of its sales are for cash and 80% are on credit.An analysis of credit sales shows that 50% are collected in the month following the sale,45% are collected in the second month,and 5% prove to be uncollectible.Calculate items (1)through (10)below:
$\begin{array}{llr} &\text { August}&\text { September }&\text {October }&\text {November }\\\text { Sales }& \$ 500,000 &\$ 525,000 &\$ 535,000 & \$ 560,000 \end{array}$

$\begin{array}{lll}&\text { October } & \text { November }\\ \text { Receipts from cash sales } & \text { (1) } \underline{\quad\quad} & \text { (6) } \underline{\quad\quad}\\\text { Collections from August credit sales } & \text { (2) }\underline{\quad\quad} & \text { (7) }\underline{\quad\quad} \\\text { Collections from September credit } & \text { (3) } \underline{\quad\quad}& \text { (8) } \underline{\quad\quad}\\\text { sales } & \\\text { Collections from October credit sales } & \text { (4) } \underline{\quad\quad}& \text { (9) }\underline{\quad\quad} \\\text { Total cash collections during the } & \text { (5) }\underline{\quad\quad}& \text { (10) } \underline{\quad\quad} \end{array}$