Question

Exercise 14-11 Preparing a schedule of cash payments for selling and administrative expenses LO 14-4 The budget director for Finch Cleaning Services prepared the following list of expected selling and administrative expenses. All expenses requiring cash payments are paid for in the month incurred except salary expense and insurance. Salary is paid in the month following the month in which it is incurred. The insurance premium for six months is paid on October 1. October is the first month of operations; accordingly, there are no beginning account balances. Required a. Complete the schedule of cash payments for S&A expenses by filling in the missing amounts b. Determine the amount of salaries payable the company will report on its pro forma balance sheet at the end of the fourth quarter. c. Determine the amount of prepaid insurance the company will report on its pro forma balance sheet at the end of the fourth quarter. Complete this question by entering your answers in the tabs below. Req B and C Req A Complete the schedule of cash payments for S&A expenses by filling in the missing amounts. November December October Budgeted S&A Expenses Equipment lease expense 6,100 $ 6,100 6,100 Salary expense 6,600 7,100 7,500 Cleaning supplies 2,790 2,890 3,070 Insurance expense 1,600 1,600 1,600 Depreciation on computer 2,400 2,400 2,400 Rent 2,200 2,200 2,200 Miscellaneous expenses 620 620 620 22,810 $ 23,490 Total operating expenses 22,410 Schedule of Cash Payments for S&A Expenses Equipment lease expense Prior month's salary expense, 100% Cleaning supplies Insurance premium Depreciation on computer Rent Miscellaneous expenses 21,410 $ 18,310 $ 19,090 Total disbursements for operating expenses <Req A Req B and C>

Answer 1

a
	October	November	December
Budgeted S&A Expenses
Equipment lease expense	6100	6100	6100
Salary expense	6600	7100	7500
Cleaning supplies	2890	2790	3070
Insurance expense	1600	1600	1600
Depreciation on computer	2400	2400	2400
Rent	2200	2200	2200
Miscellaneous expenses	620	620	620
Total operating expenses	22410	22810	23490
Schedule of Cash Payments for S&A Expenses
Equipment lease expense	6100	6100	6100
Prior month’s salary expense, 100%	0	6600	7100
Cleaning supplies	2890	2790	3070
Insurance premium	9600	0	0
Depreciation on computer	0	0	0
Rent	2200	2200	2200
Miscellaneous expenses	620	620	620
Total disbursements for operating expenses	21410	18310	19090
b
Salaries payable	7500
c
Prepaid insurance	4800	=1600*3