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Gianna runs a small business and is attempting to create a Cash Collections Budget, so she can determine her income for the first quarter of next year. She has an accounts receivable balance of $25,000\$25,000 at the end of this year and expects her ist quarter sales for next year to be $75,000\$75,000. If her standard is to collect 50%50\% of sales in the quarter in which it was earned, how much will her Total Cash Collections be for Quarter 11 of next year?\newlinea.) $25,000\$25,000\newlineb.) $75,000\$75,000\newlinec.) $62,500\$62,500\newlined.) $67,250\$67,250

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Q. Gianna runs a small business and is attempting to create a Cash Collections Budget, so she can determine her income for the first quarter of next year. She has an accounts receivable balance of $25,000\$25,000 at the end of this year and expects her ist quarter sales for next year to be $75,000\$75,000. If her standard is to collect 50%50\% of sales in the quarter in which it was earned, how much will her Total Cash Collections be for Quarter 11 of next year?\newlinea.) $25,000\$25,000\newlineb.) $75,000\$75,000\newlinec.) $62,500\$62,500\newlined.) $67,250\$67,250
  1. Calculate Sales Collection: Calculate the amount collected from next year's first quarter sales.\newlineGianna expects to collect 50%50\% of her first quarter sales. First, convert 50%50\% to a decimal.\newline50%=50100=0.550\% = \frac{50}{100} = 0.5
  2. Multiply Sales and Percentage: Multiply the first quarter sales by the percentage she expects to collect.$75,000\$75,000 (first quarter sales) * 0.50.5 (percentage collected) = $37,500\$37,500 collected from first quarter sales.
  3. Add to Accounts Receivable: Add the amount collected from next year's first quarter sales to the accounts receivable balance from the end of this year.\newlineGianna has an accounts receivable balance of $25,000\$25,000.\newline$25,000\$25,000 (accounts receivable) + $37,500\$37,500 (collected from first quarter sales) = $62,500\$62,500 total cash collections for Quarter 11 of next year.

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