Chapter 22, Problem E22.27E

Preparing a financial budget—schedule of cash payments Learning Objective 4 Mar. total cash pmts. $11,500

Marcel Company has the following projected costs for manufacturing and selling and administrative expenses:

	January	February	March
Direct materials purchases	$3,100	$ 3,500	$ 4,800
Direct labor costs	3,300	3,500	3,600
Depreciation on plant	550	550	550
Utilities for plant	550	650	650
Property taxes on plant	200	200	200
Depreciation on office	550	550	550
Utilities for office	250	250	250
Property taxes on office	170	170	170
Office salaries	3,500	3,500	3,500

All costs are paid in month incurred except: direct materials, which are paid in the month following the purchase; utilities, which are paid in the month after incurred, and property taxes, which are prepaid for the year on January 2. The Accounts Payable and Utilities Payable accounts have a zero balance on January 1. Prepare a schedule of cash payments for Marcel for January. February and March. Determine the balances in Prepaid Property Taxes, Accounts Payable, and Utilities Payable as of March 31.
Note: Exercises E22-26 and E22-27must be completed before attempting Exercise E22-28.