Mcleod fries, inc. has budgeted sales for june and july at $670,000 and $770,000, respectively. sales are 85% credit, of which 60% is collected in the month of sale and 40% is collected in the following month. what is the budgeted accounts receivable balance on july 31? $308,000 $261,800 $227,800 $654,500

Account receivable on July 31 = $261,800

Explanation:

We would not be making use of the information for June as the question says 60% is collected in the month of sale and 40% is collected in the following month . Therefore as at July 31, all of june sales would have been collected and won't be outstanding

July credit sales = 85% * $770,000 = $654,500

Collected in July (60%) = 60% * $654,500 = $392,700

Receivable as at 31 July = $654,500 - $392,700 = $261,800

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