ACC 400 Experience Tradition / tutorialrank.com ACC 400 Experience Tradition / tutorialrank.com | Page 6

d. Reduce the risks of errors
5. A company’ s past experience indicates that 60 % of its credit sales are collected in the month of sale, 30 % in the next month, and 5 % in the second month after the sale; the remainder is never collected. Budgeted credit sales were:
July $ 120,000
August 72,000
September 180,000
The cash inflow in the month of September is expected to be
a. $ 135,600
b. $ 102,600
c. $ 108,000