1. The following details have been extracted from the budget of a merchandising company. Rent Expense $8,000 per month Depreciation Expense $ 3,500 per month Insurance Expense $1,250 per month Miscellaneous Expense 2% of sales, paid as incurred Commissions Expense 10% of sales Salaries Expense $7,000 per month Dec Jan Feb March Sales $45,000 $50,000 $65,000 $80,000 C ommission and salaries expenses are paid 50% in the month to which they relate and the balance in the next month. Rent and miscellaneous expenses are paid as and when they occur. Insurance is prepaid at the beginning of the quarter. Calculate cash payments for the selling and administrative expenses for the first quarter of the next year. A. 70400 B 50500 C 75000 D 62750

1. The following details have been extracted from the budget of a merchandising company. Rent Expense $8,000 per month Depreciation Expense $ 3,500 per month Insurance Expense $1,250 per month Miscellaneous Expense 2% of sales, paid as incurred Commissions Expense 10% of sales Salaries Expense $7,000 per month Dec Jan Feb March Sales $45,000 $50,000 $65,000 $80,000 C ommission and salaries expenses are paid 50% in the month to which they relate and the balance in the next month. Rent and miscellaneous expenses are paid as and when they occur. Insurance is prepaid at the beginning of the quarter. Calculate cash payments for the selling and administrative expenses for the first quarter of the next year. A. 70400 B 50500 C 75000 D 62750

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 34E: A companys sales for the coming months are as follows: About 20 percent of sales are cash sales, and...

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Pilsner Inc. purchases raw materials on account for use in production. The direct materials purchases budget shows the following expected purchases on account: Pilsner typically pays 25% on account in the month of billing and 75% the next month. Required: 1. How much cash is required for payments on account in May? 2. How much cash is expected for payments on account in June?
A companys sales for the coming months are as follows: About 20 percent of sales are cash sales, and the remainder are credit sales. The company finds that typically 10 percent of a months credit sales are paid in the month of sale, 70 percent are paid the next month, and 15 percent are paid in the second month after sale. Expected cash receipts in July are budgeted at what amount? a. 114,520 b. 143,150 c. 145,720 d. 156,000
Ranger Industries has provided the following information at June 30: Other information: Average selling price, 196 Average purchase price per unit, 110 Desired ending inventory, 40% of next months unit sales Collections from customers: In month of sale20% In month after sale50% Two months after sale30% Projected cash payments: Inventory purchases are paid for in the month following acquisition. Variable cash expenses, other than inventory, are equal to 25% of each months sales and are paid in the month of sale. Fixed cash expenses are 40,000 per month and are paid in the month incurred. Depreciation on equipment is 2,000 per month. REQUIREMENT You have been asked to prepare a master budget for the upcoming quarter (July, August, and September). The components of this budget are a monthly sales budget, a monthly purchases budget, a monthly cash budget, a forecasted income statement for the quarter, and a forecasted September 30 balance sheet. The worksheet MASTER has been provided to assist you. Ranger Industries desires to maintain a minimum cash balance of 8,000 at the end of each month. If this goal cannot be met, the company borrows the exact amount needed to reach its goal. If the company has a cash balance greater than 8,000 and also has loans payable outstanding, the amount in excess of 8,000 is paid to the bank. Annual interest of 18% is paid on a monthly basis on the outstanding balance.
The following details have been extracted from the budget of a merchandising company. Rent Expense $9,000 per month Depreciation Expense $3,500 per month $1,250 per month Insurance Expense Miscellaneous Expense 4% of sales, paid as incurred Commissions Expense 10% of sales Salaries Expense $8,000 per month Sales Dec $75,000 Jan $80,000 Feb March $95,000 $110,000 Commissions and salaries expenses are paid 50% in the month to which they are incurred and the balance in the next month. Rent and miscellaneous expenses are paid as and when they occur. Insurance is prepaid at the beginning of the quarter. Calculate cash payments for the selling and administrative expenses for the first quarter of the next year. OA. $38,150 OB. $54,750 O C. $31,700 O D. $92,900
The following details have been extracted from the budget of a merchandising company. $8,300 per month $3,000 per month $2,000 per month 4% of sales, paid as incurred 8% of sales $8,000 per month Rent Expense Depreciation Expense Insurance Expense Miscellaneous Expense Commissions Expense Salaries Expense Sales Dec $60,000 Jan $65,000 Feb $80,000 March $95,000 Commissions and salaries expenses are paid 50% in the month to which they are incurred and the balance in the next month. Rent and miscellaneous expenses are paid as and when they occur. Insurance is prepaid at the beginning of the quarter. Calculate cash payments for the selling and administrative expenses for the first quarter of the next year.
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The following details have been extracted from the payables' records of X Co: Invoices paid in the month of purchase 25% Invoices paid in the first month after purchase 70% Invoices paid in the second month after purchase 5% Purchases for July to September are budgeted as follows: July $250,000 August $300,000 September $280,000 For suppliers paid in the month of purchase, a settlement discount of 5% is received. What is the amount budgeted to be paid to suppliers in September?
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