Question

Zisk Co. purchases raw materials on account. Budgeted purchase amounts are April, $80,000; May, $110,000; and June, $120,000. Payments are made as follows: 70% in the month of purchase and 30% in the month after purchase. The March 31 balance of accounts payable is $22,000. Prepare a schedule of budgeted cash payments for April, May, and June.

Answer 1

Answer and Explanation:

The preparation of the schedule for budgeted cash payment for the April, May and June is presented below:

Particulars April May June

Current month $56,000 $77,000 $84,000

($80,000 × 70%) ($110,000 × 70%) ($120,000 × 70%)

Prior month $24,000 $33,000 $36,000

($80,000 × 30%) ($110,000 × 30%) ($120,000 × 30%)

Total purchase $80,000 $110,000 $120,000