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adoni
1 month ago
12

If the actual A/R at the end of February was $12,000 and projected sales in March are $50,000, where 70% of sales are on credit,

60% of credit sales are collected in the month of the sale, and 40% are collected in the month after the sale, what is the projected A/R balance on the pro forma balance sheet for the end of March?
Business
1 answer:
marusya05 [3.7K]1 month ago
8 0

Answer:

The anticipated balance of accounts receivable on the pro forma balance sheet for March's end is $26,000

Explanation:

The calculation for the expected A/R balance for March is presented below:

= February A/R + March A/R

where,

February A/R = $12,000

And, March A/R = March Projected sales × percentage of credit sales × next month collection rate

=$50,000 × 70% × 40%

= $14,000

Substituting these values in the above calculation

Thus, the final result is

=$12,000 + $14,000

=$26,000

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