Becham Inc.had the following purchases budgeted for the last quarter of 2009:
$\begin{array}{lr}
\text { October } &\$75000\
\text { November } &90000\
\text { December } &84000\
\end{array}$

Becham pays one-half of a month's purchases in the month of purchase and the remainder in the following month.What are expected cash disbursements for the month of December?
A) $124 500
B) $ 84 000
C) $ 87 000
D) $ 42 000

Question

Becham Inc.had the following purchases budgeted for the last quarter of 2009:
$\begin{array}{lr}
  \text { October } &\$75000\
 \text { November } &90000\
 \text { December } &84000\
\end{array}$

Becham pays one-half of a month's purchases in the month of purchase and the remainder in the following month.What are expected cash disbursements for the month of December?
A) $124 500
B) $ 84 000
C) $ 87 000
D) $ 42 000

Quizplus · Accepted Answer

According to the given information, one-half of the November purchases, which is $60,000, will be paid in November, and the other half will be paid in December. Therefore, the cash disbursements for November will be $60,000. For December, we need to consider the purchases budgeted for December, which is $54,000, and the remaining one-half payment of November purchases, which is $60,000/2 = $30,000. So, the expected cash disbursement for December will be $54,000 + $30,000 = $87,000. Therefore, option C is correct.

Becham Inc October $75000 November 90000 December 84000\begin{array}{lr} \text { October } &\$75000\\ \text { November } &90000\\ \text { December } &84000\\\end{array} October November December ​$750009000084000​

Becham Inc $\begin{array}{lr} \text { October } &\$75000\\ \text { November } &90000\\ \text { December } &84000\\\end{array}$