The Model Company Is to Begin Operations in April

question 137

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 will represent cash sales;75% of the balance will be collected in the month following the sale,17% the second month,6% the third month,and the balance is bad debts.Assume the Model Company charges 1 1/2% on any balance that is not collected in the month following the month of sale.This charge will 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.What is the amount of cash to be collected in July?

• A) $39,199.
• B) $35,312.
• C) $38,193.
• D) $36,242.

---

Definitions:

Experience Flow

Experience flow is a state of deep immersion and involvement in an activity, often leading to heightened enjoyment and fulfillment.

Experience of Flow

A highly focused mental state conducive to productivity and creativity, where an individual is fully absorbed and involved in the activity at hand.

Work

A task or series of tasks performed to achieve a goal, often associated with a professional or formal employment context.

Satisfying

Satisfying is the process of making sufficient or adequate decisions based on a specific set of criteria, often used in problem-solving and decision-making contexts.