Finch Company began its operations on March 31 of the current year. Finch has the following projected costs: May June April $157,200 $197,600 $201,000 970 2,200 420 Manufacturing costs" Insurance expense** 970 2,200 420 970 Depreciation expense Property tax expense*** *Of the manufacturing costs, three-fourths are paid for in the month they are incurred; one-fourth is paid in the following month. **Insurance expense is $970 a month; however, the insurance is paid four times yearly in the first month of the quarter, (.e., January, April, July, and October). ***Property tax is paid once a year in November. The cash payments expected for Finch Company in the month of May are O&$187.500 b. $39,300 Oe5148,200 &$226,800 2,200 420

Finch Company began its operations on March 31 of the current year. Finch has the following projected costs: May June April $157,200 $197,600 $201,000 970 2,200 420 Manufacturing costs" Insurance expense 970 2,200 420 970 Depreciation expense Property tax expense* Of the manufacturing costs, three-fourths are paid for in the month they are incurred; one-fourth is paid in the following month. Insurance expense is $970 a month; however, the insurance is paid four times yearly in the first month of the quarter, (.e., January, April, July, and October). Property tax is paid once a year in November. The cash payments expected for Finch Company in the month of May are O&$187.500 b. $39,300 Oe5148,200 &$226,800 2,200 420

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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Concept explainers

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.

Question

Finch Company began its operations on March 31 of the current year. Finch has the following projected costs:
June
$201,000
Manufacturing costs"
Insurance expense**
April May
$157,200 $197,600
970
970
2,200
420
2,200
420
970
Depreciation expense
Property tax expense***
"Of the manufacturing costs, three-fourths are paid for in the month they are incurred; one-fourth is paid in the following month.
**Insurance expense is $970 a month; however, the insurance is paid four times yearly in the first month of the quarter, (.e., January, April, July, and October).
***Property tax is paid once a year in November.
The cash payments expected for Finch Company in the month of May are
O&$187.500
b. $39,300
Oe5148,200
Od $226,800
2,200
420

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