Need help with this general accounting question Prime Manufacturing Company expects to purchase $90,000 of materials inNovember and $120,000 of materials in December. Seventy percent of allpurchases are paid for in the month of purchase, and the remaining thirtypercent are paid in the month following the purchase.How much will December's cash disbursements for materials purchases be?Options:A) $120,000B) $105,000c) $111,000D) $108,000

Step 1: Define Cash Disbursements for Materials PurchasesCash disbursements for materials purchases…

Answered: Prime Manufacturing Company expects to…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 11EB: Gear Up Co. pays 65% of its purchases in the month of purchase, 30% in the month after the purchase,...

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Q1) Sales are budgeted at $360,000 for November, $380,000 for December, and $370,000 for January. The cost of goods sold is 74% of sales. The company desires an ending merchandise inventory equal to 75% of the cost of goods sold in the following month. Payment for merchandise is made in the month following the purchase. Other monthly expenses to be paid in cash are $22,400. Monthly depreciation is $22,200. Ignore taxes. Balance SheetOctober 31 Assets Cash $ 23,200 Accounts receivable 84,200 Merchandise inventory 199,800 Property, plant and equipment (net of $606,000 accumulated depreciation) 1,016,000 Total assets $ 1,323,200 Liabilities and Stockholders' Equity Accounts payable $ 197,200 Common stock 610,000 Retained earnings 516,000 Total liabilities and stockholders' equity $ 1,323,200 Required: (need these two parts)d. Prepare Budgeted Income Statements for November and December. e. Prepare a Budgeted Balance Sheet for…
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