Solved

The Model Company Is to Begin Operations in April

question 11

Multiple Choice

The Model Company is to begin operations in April. It has budgeted April sales of $30,000, May sales of $34,000, June sales of $40,000, July sales of $42,000, and August sales of $38,000. Note that 10% of each month's sales is expected to represent cash sales; 75% of the balance is expected to be collected in the month following the sale, 17% the second month, 6% the third month, and the balance is expected to be uncollectible.
-
The Model Company is considering charging 1 1/2% on any balance that is not collected in the month following the month of sale. This charge would also change the collection percentages to 15% cash sales, 80% of the balance collected in the month following the sale, 16% the second month, and 3% the third month. This stricter credit policy will reduce the estimated sales budgets by 7% each month. Under this stricter credit policy, what is the amount of cash to be collected in July? Round all calculations to the nearest whole dollar.

Definitions:

Sign Language

A visual language that uses hand shapes, facial expressions, and body movements to convey meaning among deaf and hard of hearing people.

Neural Networks

Computing systems vaguely inspired by the biological neural networks in animal brains, capable of learning and making decisions.

Cerebral Cortex

The outermost layer of the brain, vital for cognitive functions including reasoning, language, and memory.

Language Functions

The roles that language serves in communication, such as informational, expressive, directive, and social functions.