Purchases of direct material for May were $115,000,while expected purchases for June and July are $121,000 and $136,000,respectively.All purchases are paid 25% in the month of purchase and 75% the following month.Calculate the budgeted payments for the month of June.

Question

Quizplus · Accepted Answer

In June, 25% of June's purchases ($121,000) are paid, which is $30,250. Additionally, 75% of May's purchases ($115,000) are paid, which is $86,250. The total payment for June is $30,250 + $86,250 = $116,500.

Purchases of Direct Material for May Were $115,000,while Expected Purchases