Nuthatch Corporation Began Its Operations on September 1 of the Current

question 84

Multiple Choice

Nuthatch Corporation began its operations on September 1 of the current year. Budgeted sales for the first three months of business-September, October, and November-are $260,000, $375,000, and $400,000, respectively. The company expects to sell 30% of its merchandise for cash. Of sales on account, 80% are expected to be collected in the month of the sale and 20% in the month following the sale.​
-The cash collections expected in November from accounts receivable are projected to be

• A)$280,000
• B)$316,400
• C)$295,200
• D)$276,500

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Definitions:

Recessionary Period

A time of economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters.

Consumer Spending

The total amount of money spent by consumers on goods and services within an economy, a crucial factor for economic analysis.

Discretionary Income

The amount of an individual's income that is left for spending, investing, or saving after taxes and personal necessities are paid.

Discretionary

Refers to funds or expenses that are non-essential and can be adjusted or eliminated depending on the financial situation.