April May June Manufacturing costs* $156,800 $195,200 $217,600 Insurance expense"* Depreciation expense 2,000 1,000 1,000 1,000 2,000 2,000 Property tax expense*** 500 500 500 *Of the manufacturing costs, three-fourths is paid for in the month they are incurred; one-fourth is paid in the following month. **Insurance expense is $1,000 a month; however, the insurance is paid four times yearly in the first month of the quarter (i.e., January, April, July, and October). ***Property tax is paid once a year in November.

April May June Manufacturing costs* $156,800 $195,200 $217,600 Insurance expense"* Depreciation expense 2,000 1,000 1,000 1,000 2,000 2,000 Property tax expense*** 500 500 500 Of the manufacturing costs, three-fourths is paid for in the month they are incurred; one-fourth is paid in the following month. Insurance expense is $1,000 a month; however, the insurance is paid four times yearly in the first month of the quarter (i.e., January, April, July, and October). Property tax is paid once a year in November.

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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Cash Payments Schedule Fein Company provided the following information relating to cash payments: Fein purchased direct materials on account in the following amounts: June $68,000 July 77,000 August 73,000 Fein pays 20% of accounts payable in the month of purchase and the remaining 80% in the following month. In July, direct labor cost was $34,300. August direct labor cost was $35,400. The company finds that typically 90% of direct labor cost is paid in cash during the month, with the remainder paid in the following month. August overhead amounted to $77,200, including $6,350 of depreciation. Fein had taken out a 4-month loan of $15,000 on May 1. Interest, due with payment of principal, accrued at the rate of 9% per year. The loan and all interest were repaid on August 31. (Note: Use whole months to compute interest payment.) Required: Prepare a schedule of cash payments for Fein Company for the month of August. Be sure to enter percentages as whole numbers.…
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