Answered

Preparing an Accounts Payable Schedule Wight Inc. purchases raw materials on account for use in production. The direct materials purchases budget shows the following expected purchases on account: April $374,400 May 411,400 June 416,700 Wight typically pays 35% on account in the month of billing and 65% the next month.

Required: 1. How much cash is required for payments on account in May?

2. How much cash is expected for payments on account in June?

Answer :

Kolawole845

Answer:

Cash payment expected for May     $387,350.00

Cash payment expected for June     $413,255.00

Explanation:

The question is centered around the preparation of cash budget.

  1. Note that the principles are simply that only items of cash paid or received should be captured in the cash budget. So you should avoid items like depreciation, provisions e.t.c
  2. Also, the cash flows are captured at the time the they occur.

So applying these principles, we can prepare the Expected Cash Payment Schedule for Wight Inc as follows:

Expected Cash Payment Schedule

Installment                               Workings                          May

Month of billing                                  35% * 411,400    143,990

Next Month(for April purchases )            65%*374,400    243,360

Cash payment for  May                                                          387,350

 

Installment  Workings                             June

Month of billing       35% * 416,700              145,845

Next Month(for May)       65%*411,400                 267,410

Cash payment for June                 413,255.00

Cash payment expected for May     $387,350.00

Cash payment expected for June     $413,255.00

please find the answer in an attachment

${teks-lihat-gambar} Supabrain

Other Questions