Fresplanade Co

question 117

Multiple Choice

Fresplanade Co. had the following historical collection pattern for its credit sales:

75% collected in the month of sale
12% collected in the first month after month of sale
8% collected in the second month after month of sale
3% collected in the third month after month of sale
2% uncollectible

The sales on open account (credit sales) have been budgeted for the last six months of the year as shown below:
The estimated cash collection by Fresplanade Co. during September from credit sales in July, August, and September is:

• A) $83,160.
• B) $79,380.
• C) $87,840.
• D) $54,000.
• E) $71,640.