Answer :
Answer:
How much cash is expected for payments on account in June? = $412,400.
Explanation:
Cash Required for expected payments on account in June
Pilsner Inc. pays 25% on account in the month of billing and the remaining 75% in the next month, therefore, for the month of June the total payment will include 75% of Purchases made in May and 25% of purchases made in June.
Purchases in May = $411,200
Purchases in June = $416,000
Total Payment for May = (75% of 411,200)+(25% of 416,000)
= $308,400 + $104,000
= $412,400.
QUESTION: The question is incomplete. The materials purchases budget was not added to your question. below is the remaining part of the question and the answer.
Expected Purchases on account:
April ------------ $374,400
May---------------$411,200
June -------------$416,000
Answer:
1. Cash payment for May = $383,600
2. Cash payment for June = $412,400
Explanation:
Budget for payment of inventory is prepared as;
April May June
Budget purchases $374,400 $411,200 $416,000
Payment for the month:
April ($374,400*25%) $93,600 $280000
May ($411,200*25%) $102800 $308400
June ($416,000*25% $104000
Total: $93,600 $383,600 $412400
1. Therefore, cash payment for May = $383,600
2. Cash payment for June = $412,400