The Following Credit Sales Are Budgeted by Polex Electronics The Company's Past Experience Indicates That 50% of the Accounts

question 106

Multiple Choice

The following credit sales are budgeted by Polex Electronics: $$\begin{array} { l r } \text { January } & \$ 124,000 \\\text { February } & 120,000 \\\text { March } & 135,000 \\\text { April } & 140,000 \\\text { May } & 142,000\end{array}$$ The company's past experience indicates that 50% of the accounts receivable are collected in the month of sale, 30% in the month following the sale, and 18% in the second month following the sale.Two percent are uncollectible.How much does the company anticipate as cash receipts for March?

• A)$132,300
• B)$125,820
• C)$135,060
• D)$122,300

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Definitions:

Price Discriminate

Price discrimination is the practice of selling the same product or service at different prices to different customers, often based on willingness to pay, without a corresponding cost difference.

Complementary Demand

Refers to products or services for which the demand increases or decreases together because they are used together, like smartphones and data plans.

Double Markup

A pricing strategy where a product is marked up twice before it reaches the final consumer: first by the wholesaler then by the retailer, leading to a higher final price.

Upstream Firms

Companies involved in the early stages of production or supply chain, such as raw material extraction or initial processing, before manufacturing.