Fortune Company's direct materials budget shows the following cost of materials to be purchased for the coming three months: January February March Material purchases $ 13,120 $ 15,230 $ 12,050 Payments for purchases are expected to be made 50% in the month of purchase and 50% in the month following purchase. The December Accounts Payable balance is $7,800. The budgeted cash payments for materials in January are:

Fortune Company's direct materials budget shows the following cost of materials to be purchased for the coming three months: January February March Material purchases $ 13,120 $ 15,230 $ 12,050 Payments for purchases are expected to be made 50% in the month of purchase and 50% in the month following purchase. The December Accounts Payable balance is $7,800. The budgeted cash payments for materials in January are:

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter8: Budgeting

Section: Chapter Questions

Problem 6BE: Cash budget Pasadena Candle Inc. pays 40% of its purchases on account in the month of the purchase...

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Pilsner Inc. purchases raw materials on account for use in production. The direct materials purchases budget shows the following expected purchases on account: Pilsner typically pays 25% on account in the month of billing and 75% 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?
Pasadena Candle Inc. projected sales of 800,000 candles for January. The estimated January 1 inventory is 35,000 units, and the desired January 31 inventory is 20,000 units. What is the budgeted production (in units) for January?
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