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MCD1010 - T3 - 2024 Electric Entertainments Inc- Cash receipts from cash and credit sales.

Multiple fill-in-the-blank

Question textElectric Entertainments Inc sell games and movies to Movie Theatres throughout Australia. Some sales are for cash and some are on credit. During June 2022, cash sales of games were $25,000 and credit sales were $35,000. The sales of movies were $48,000 cash and $63,000 credit. What are the cash receipts in June 2022? $Answer 1 Question 1[input] When will the credit sales money be received? Answer 2 Question 1[select: , Never, Next month, In the future] If past experience have found that on average 60% of credit sales are collected in the month following the sale, 30% collected 2 months after the sale and the remaining 10% is collected in the 3rd month after the sale. What will be the receipts from these credit sales in July? $Answer 3 Question 1[input]. What will be the receipts from these credit sales in August? $Answer 4 Question 1[input]. What will be the receipts from these credit sales in September? $Answer 5 Question 1[input].

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The question asks us to determine cash receipts under a mix of cash and credit sales, and then to project the timing of collections from credit sales. Option 1 for the first blank presents the total cash receipts in June from both games and movies. Cash sales for games are 25,000 and cash sales for movies are 48,000, so June cash receipts = 25,000 + 48,000 = 73,000. This matches the provided answer of 73,000, so this option is correct for the first blank. Option 2 asks when......Login to view full explanation

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