Question

18 My Subscriptions Questions incorrect Seth Kore Mark 0.00 out of. Hal question Cash Disbursements Assume that Ringwood Manufacturing manages its cash flow from its home office. Ringwood controls cash disbursements by category and month. In setting its budget for the next six months, beginning in July, it used the following managerial guidelines: Category Guidelines Purchases Pay half in current and half in following month Payroll Pay 70 percent in current month and 30 percent in following month Loan Payments Pay total amount due each month Predicted activity for selected months follow Category May June July August Purchases 60,000 $74,000 $ 79,000 $85.000 Payroll 130,000 140,000 150.000 150.000 Loan payments 40,000 40,000 45.000 45.000 Prepare activity for selected months follow. Catogory May June July August Purchases $50,000 574.000 $79.000 585,000 Payroll 130.000 140.000 150,000 130,000 Loan payments 40.000 40,000 45,000 45,000

Answer 1

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Ringwood Manufacturing Schedule of Cash Disbursements For the month of July and August July August Accounts Payable $76,500 $82,000 Payroll $147,000 $136,000 Loan payments $45,000 $45,000 Total $268,500 $263,000 Working notes Cash disbursements for payments July August June Payments $37,000 July Payments $39,500 $39,500 August Payments $42,500 Total $76,500 $82,000 August Cash disbursements for Payroll July June Payments $42,000 July Payments $105,000 August Payments Total $147,000 $45,000 $91,000 $136,000