Dozier Company has a problem managing cash. From the following data determine the cash disbursements for the month of May. Sales: April, $16000; May $20,000; June $23,000. Other data are as follows: Purchases of inventory are 60% of sales. Payments of purchases of inventory are made one month after purchase. Selling expenses are 15% of sales and are paid in the same month as the associated sales. Administrative expenses (excluding rent and depreciation) are 20% of sales and are paid in the same month as the associated sales. Rent expenses is $1,200 per month and is paid each month. Equipment depreciation is 5% of sales.

Dozier Company has a problem managing cash. From the following data determine the cash disbursements for the month of May. Sales: April, $16000; May $20,000; June $23,000. Other data are as follows: Purchases of inventory are 60% of sales. Payments of purchases of inventory are made one month after purchase. Selling expenses are 15% of sales and are paid in the same month as the associated sales. Administrative expenses (excluding rent and depreciation) are 20% of sales and are paid in the same month as the associated sales. Rent expenses is $1,200 per month and is paid each month. Equipment depreciation is 5% of sales.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 24E: Del Spencer is the owner and founder of Del Spencers Mens Clothing Store. Del Spencers has its own...

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