Weaver, Inc.has budgeted direct materials purchases of $150,000 in March and $240,000 in April.Past experience indicates that the company pays for 70% of its purchases in the month of purchase and the remaining 30% in the next month.Other costs are all paid during the month incurred.During April, the following items were budgeted: How much is budgeted cash disbursements for April?

Question

Weaver, Inc.has budgeted direct materials purchases of $150,000 in March and $240,000 in April.Past experience indicates that the company pays for 70% of its purchases in the month of purchase and the remaining 30% in the next month.Other costs are all paid during the month incurred.During April, the following items were budgeted:  How much is budgeted cash disbursements for April?

Quizplus · Accepted Answer

In April, the company pays for 70% of March purchases ($150,000 x 70% = $105,000) and 30% of April purchases ($240,000 x 30% = $72,000), as well as any other costs incurred in April. 
Therefore, the budgeted cash disbursements for April are:
$105,000 (March purchases) + $72,000 (April purchases) + other costs = $348,000.