Broihan Corporation has the following purchases budget for the last half of 2002: July $100,000 ;...
Question:
Broihan Corporation has the following purchases budget for the last half of 2002 :
| July | $100,000 |
| August | $80,000 |
| September | $110,000 |
| October | $90,000 |
| November | $100,000 |
| December | $94,000 |
Historically, the company pays one half at the time of purchase and the remainder in the month following purchase.
What are the expected cash disbursements in August?
a. $ 80,000.
b. $ 90,000.
c. $ 95,000.
d. $100,000
e. $105,000
Budget:
A firm usually prepares a cash budget in advance for the upcoming financial period to ensure that the expected cash inflows (or receipts) are in line with the expected cash outflows (or expenses). The budget is further categorized into purchase budget, sales budget, direct materials budget, etc.
Answer and Explanation: 1
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View this answerThe calculated value of expected cash disbursements in August is option b. $90,000.
Given that the company pays one-half at the time of purchase...
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