ABC Company's raw materials purchases for June, July, and August are budgeted at $54,000, $44,000, and $69,000, respectively.Based on past experience, ABC expects that 70% of a month's raw material purchases will be paid in the month of purchase and 30%in the month following the purchase.Required:Prepare an analysis of cash disbursements from raw materials purchases for ABC Company for August.Budgeted raw material purchasesCurrent month's purchasesAugust cash payments:Prior month's purchasesTotal cash paymentsJuneJulyAugust$0

Raw materials are fundamental elements utilized in manufacturing or production processes to…

Answered: ABC Company's raw materials purchases…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The Model Company is to begin operations in April. It has budgeted April sales of $70,000, May sales of $74,000, June sales of $80,000, July sales of $82,000, and August sales of $78,000. Note that 10% of each month's sales is expected to represent cash sales; 75% of the balance is expected to be collected in the month following the sale, 17% the second month, 6% the third month, and the balance is expected to be uncollectible. What is the amount of cash to be collected in the month of July?
Company L charges all operating expenses to credit. They pay 70% of their accounts payable in the month following the expense, and 30% two months following the expense. Expenses (all paid for on credit) for the last three months have been provided below: August: $80,000 September: $120,000 October: $94,000 What is the budgeted cash outflow for October?
Nuthatch Corporation began its operations on September 1 of the current year. Budgeted sales for the first three months of business September, October, and November are $239,000, $319,000, and $424,000, respectively. The company expects to sell 30% of its merchandise for cash. Of sales on account, 80% are expected to be collected in the month of the sale and 20% in the month following the sale. The cash collections expected in November from accounts receivable are projected to be: Ca. $338,520 Ob. $282,100 Oc. $237,440 Od. $192,780
A manufacturing company's sales budget indicates the following sales: January: $30,000; February: $20,000; March: $15,000. The company expects 80% of the sales to be on account. Credit sales are collected 30% in the month of the sale and 70% in the month following the sale. The total cash receipts collected during March will be $
Zisk Co. purchases raw materials on account. Budgeted purchase amounts are April, $81,000; May, $111,000; and June, $121,000. Payments are made as follows: 75% in the month of purchase and 25% in the month after purchase. The March 31 balance of accounts payable is $23,000. Prepare a schedule of budgeted cash payments for April, May, and June. April May June Current month purchases 75% Ending accounts payable 25% Total purchases Zisk Co. Schedule of Cash Payments For April, May, and June April May June Cash payments for: Current month purchases Prior month purchases Budgeted cash payments for materials
Haylock Incorporated bases its manufacturing overhead budget on budgeted direct labor-hours. The direct labor budget indicates that 8,300 direct labor-hours will be required in August. The variable overhead rate is $1.40 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $100,320 per month, which includes depreciation of $9,030. All other fixed manufacturing overhead costs represent current cash flows. The August cash disbursements for manufacturing overhead on the manufacturing overhead budget should be: Multiple Choice $11,620 $102,910 $91,290 $111,940
Big Wheel, Inc. collects 25% of its sales on account in the month of the sale and 75% in the month following the sale. Sales on account are budgeted to be $20,800 for March and $65,700 for April. What are the budgeted cash receipts from sales on account for April?
Waterway Company prepares monthly cash budgets. Relevant data from operating budgets for 2027 are as follows. January February Sales $460,800 $512,000 Direct materials purchases 153,600 160,000 Direct labor 115,200 128,000 Manufacturing overhead 89,600 96,000 Selling and administrative expenses 101,120 108,800 All sales are on account. Collections are expected to be 50% in the month of sale, 30% in the first month following the sale, and 20% in the second month following the sale. Sixty percent (60%) of direct materials purchases are paid in cash in the month of purchase, and the balance due is paid in the month following the purchase. All other items above are paid in the month incurred except for selling and administrative expenses, which include $1,280 of depreciation per month. Other data: 1. Credit sales: November 2026, $320,000; December 2026, $409,600. 2. Purchases of direct materials: December 2026, $128,000. 3. Other receipts: January-Collection of December 31, 2026, notes…
The accountant for Baird's Dress Shop prepared the following cash budget. Baird's desires to maintain a cash balance of $24,000 at the end of each month. Funds are assumed to be borrowed and repaid on the last day of each month. Interest is charged at the rate of 1 percent per month. Required a. Complete the cash budget by filling in the missing amounts. b. Determine the amount of net cash flows from operating activities Baird's will report on the third quarter pro forma statement of cash flows. c. Determine the amount of net cash flows from financing activities Baird's will report on the third quarter pro forma statement of cash flows. Complete this question by entering your answers in the tabs below. Req A Req B and C Complete the cash budget by filling in the missing amounts. Note: Any shortages or repayments should be indicated with a minus sign. Round your answers to the nearest whole dollar amount. Cash Budget July August September Section 1: Cash receipts Beginning cash balance…
Nuthatch Corporation began its operations on September 1 of the current year. Budgeted sales for the first three months of business September, October, and November are $245,000, $311,000, and $413,000, respectively. The company expects to sell 30% of its merchandise for cash. Of sales on account, 80% are expected to be collected in the month of the sale and 20% in the month following the sale. The cash collections expected in November from accounts receivable are projected to be: a. $231,280 O b. $187,740 Oc. $329,784 Od. $274,820
Lily Company expects to have a cash balance of $49,500 on January 1, 2022. Relevant monthly budget data for the first 2 months of 2022 are as follows. Collections from customers: January $93,500, February $165,000. Payments for direct materials: January $55,000, February $82,500. Direct labor: January $33,000, February $49,500. Wages are paid in the month they are incurred. Manufacturing overhead: January $23,100, February $27,500. These costs include depreciation of $1,650 per month. All other overhead costs are paid as incurred. Selling and administrative expenses: January $16,500, February $22,000. These costs are exclusive of depreciation. They are paid as incurred. Sales of marketable securities in January are expected to realize $13,200 in cash. Lily Company has a line of credit at a local bank that enables it to borrow up to $27,500. The company wants to maintain a minimum monthly cash balance of $22,000. Prepare a cash budget for January and February. LILY COMPANY Cash Budget…
McMichael Inc. collects 90% of its sales on account in the month of the sale and 10% in the month following the sale. If sales on account are budgeted to be $495,000 for September and $431,000 for October, what are the budgeted cash receipts from sales on account for October?$

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