Fashion Jeans, Inc., sells two lines of jeans: Simple Life and Fancy Life. Simple Life sells for $85, and Fancy Life sells for $100. The company sells all of its jeans on credit and estimates that 60% is collected in the month of the sale, 35% is collected in the following month, and the rest is considered to be uncollectible. The estimated sales for Simple are: January, 20,000 pairs of jeans; February, 27,500 pairs of jeans; and March, 25,000 pairs of jeans. The estimated sales for Fancy are: January, 18,000 pairs of jeans; February, 19,000 pairs of jeans; and March, 20,500 pairs of jeans. The expected cash receipts for the month of March is

A) $3,988,125
B) $2,505,000
C) $2,125,000
D) $4,175,000

To calculate the expected cash receipts for March, we need to consider the collections from sales made in both February and March, including both Simple Life and Fancy Life jeans, and account for the collection percentages provided.1. Calculate sales for February and March: - Simple Life February Sales: 27,500 pairs * $85 = $2,337,500 - Simple Life March Sales: 25,000 pairs * $85 = $2,125,000 - Fancy Life February Sales: 19,000 pairs * $100 = $1,900,000 - Fancy Life March Sales: 20,500 pairs * $100 = $2,050,0002. Calculate collections from February sales in March: - 35% of Simple Life February Sales: $2,337,500 * 35% = $817,125 - 35% of Fancy Life February Sales: $1,900,000 * 35% = $665,0003. Calculate collections from March sales in March: - 60% of Simple Life March Sales: $2,125,000 * 60% = $1,275,000 - 60% of Fancy Life March Sales: $2,050,000 * 60% = $1,230,0004. Total expected cash receipts for March: - From February sales: $817,125 (Simple Life) + $665,000 (Fancy Life) = $1,482,125 - From March sales: $1,275,000 (Simple Life) + $1,230,000 (Fancy Life) = $2,505,000 - Total: $1,482,125 + $2,505,000 = $3,987,125The closest answer provided is $3,988,125, which seems to be a slight rounding difference in the calculation. Therefore, the correct choice is A.