Rishi Sunak Manufacturing Pte. Ltd. is preparing its budget for next year. The company estimates that it will be making the following raw materials purchases in the last five months of 2021: $200,000 in August, $220,000 in September, $250,000 in October, $280,000 in November and $240,000 in December. The company anticipates that it will pay 55% of what is owed one month after the month of purchase, 30% of what is owed two months after the month of purchase and the remaining 15% three months after the month of purchase. What figure will be presented in the company’s cash budget for payments for raw materials purchases in December 2021? $233,500 $253,500 $262,000 $403,500
Rishi Sunak Manufacturing Pte. Ltd. is preparing its budget for next year. The company estimates that it will be making the following raw materials purchases in the last five months of 2021: $200,000 in August, $220,000 in September, $250,000 in October, $280,000 in November and $240,000 in December. The company anticipates that it will pay 55% of what is owed one month after the month of purchase, 30% of what is owed two months after the month of purchase and the remaining 15% three months after the month of purchase. What figure will be presented in the company’s cash budget for payments for raw materials purchases in December 2021? $233,500 $253,500 $262,000 $403,500
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter9: Profit Planning And Flexible Budgets
Section: Chapter Questions
Problem 45BEB: Pilsner Inc. purchases raw materials on account for use in production. The direct materials...
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Rishi Sunak Manufacturing Pte. Ltd. is preparing its budget for next year. The company estimates that it will be making the following raw materials purchases in the last five months of 2021: $200,000 in August, $220,000 in September, $250,000 in October, $280,000 in November and $240,000 in December. The company anticipates that it will pay 55% of what is owed one month after the month of purchase, 30% of what is owed two months after the month of purchase and the remaining 15% three months after the month of purchase. What figure will be presented in the company’s cash budget for payments for raw materials purchases in December 2021?
$233,500
$253,500
$262,000
$403,500
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