QS 22-22 (Algo) Computing budgeted accounts receivable LO P2 Kingston budgets total sales for June and July of $\$ 400,000$ and $\$ 428,000$, respectively. Cash sales are $65 \%$ of total sales. Of the credit sales, $15 \%$ are collected in the month of sale, $65 \%$ are collected during the first month after the sale, and the remaining $20 \%$ are collected in the second month after the sale. Determine the amount of accounts receivable reported on the company's budgeted balance sheet as of July 31. Hint: Determine the percent of June and July sales that are uncollected at July 31. \begin{tabular}{|c|c|c|c|c|c|c|} \hline \multirow[b]{2}{*}{ Sales month } & \multirow{2}{*}{\multicolumn{2}{|c|}{ Total Sales }} & \multirow{2}{*}{\multicolumn{2}{|c|}{ Credit Sales }} & \multicolumn{2}{|c|}{ As of July 31} \\ \hline & & & & & \begin{tabular}{l} Percent \\ Uncollected \end{tabular} & \begin{tabular}{c} Amount \\ Uncollected \end{tabular} \\ \hline June & $\$$ & 400,000 & s & 140,000 & $65 \%$ & 140,000 \\ \hline July & & 428,000 & & & $20 \%$ & \\ \hline Total & & & & & & \\ \hline \end{tabular}

Step 1 ：Calculate the credit sales for each month. Credit sales are the total sales minus the cash sales. Cash sales are \(65\%\) of total sales, so credit sales are \(35\%\) of total sales.

Step 2 ：For June: Credit sales = \(35\%\) of \$400,000 = \$140,000

Step 3 ：For July: Credit sales = \(35\%\) of \$428,000 = \$149,800

Step 4 ：Calculate the amount of credit sales that are uncollected at the end of July. For June sales, \(65\%\) are collected in the first month after the sale, so \(35\%\) are uncollected at the end of July. For July sales, \(15\%\) are collected in the month of sale and \(65\%\) are collected in the first month after the sale, so \(20\%\) are uncollected at the end of July.

Step 5 ：Uncollected June sales = \(35\%\) of \$140,000 = \$49,000

Step 6 ：Uncollected July sales = \(20\%\) of \$149,800 = \$29,960

Step 7 ：Add these two amounts to find the total accounts receivable reported on the company's budgeted balance sheet as of July 31.

Step 8 ：Total accounts receivable = \$49,000 + \$29,960 = \$78,960

Step 9 ：\(\boxed{\text{So, the amount of accounts receivable reported on the company's budgeted balance sheet as of July 31 is }\$78,960}\)