Use the following information to answer the five questions in the quiz: Door & Window Co. was organized on August 1 of the current year. Projected sales for the next three months are as follows:
August $$120,000
September $200,000
October $230,000
1. The company expects to sell 40% of its merchandise for cash. Of the sales on account, 25% are expected to be collected in the month of the sale and the remainder in the following month.
What are the total credit sales for August:
a. $120,000
b. $72,000
c. $48,000
d. none of the above
2. What are the total credit sales for October:
a. $92,000
b. $120,000
c. $138,000
d. none of the above
3. What are the total cash collections for August?
a. $120,000
b. $72,000
c. $48,000
d. $66,000
4.What are the total cash collections for September?
a. $164,000
b. $80,000
c. $200,000
d. $120,000
5. What are the total cash collections for October?
a. $230,000
b. $138,00
c. $216,500
d. $92,000