The finance manager wants to prepare a cash budget until June 2024. The finance manager has received the following information from the marketing and operations managers:
The sales in October 2023 were $150,000. The finance department has determined that, based on the past sales data and near-term market conditions, it may be reasonable to expect that sales will grow by a modest 1% each month.
The credit department expects:
a. 60% of the sales each month to be collected in the same month.
b. 38% of the sales to the collected in the following month.
c. 2% of the sales will not be collected (bad debts)
