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A Landscaping Inc. is preparing its budget for the first months of 2019. The next...

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Question

Accounting

A Landscaping Inc. is preparing its budget for the first months of 2019. The next step in the budgeting process is to prepare a cash receipts schedule and a cash payments schedule. To that end the following information has been collected. 10% of all sales are for Cash. Credit customers usually pay 20% of their fee in the month that service is provided, 60% the month after, 18% the second month after receiving service. The remaining 2% is written off in the third month following the service,

Expected revenues are: October 2018, $100,000; November 2018, $120,000; December 2018, $150,000; January 2019, $130,000; February 2019, $180,000; March 2019, $190,000; April 2019, $200,000

Cash paid out for January purchases will be $60,000.

Instructions

  1. Prepare the following schedule showing expected collections from clients for January and February of 2019.

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