Refer to the information in PA8-1. Iguana, Inc., had $10,800 cash on hand on April 1. Of
Question:
Of raw materials purchases, 80 percent is paid for during the month purchased and 20 percent is paid in the following month. Raw materials purchases for March 1 totaled $2,000. All other operating costs are paid during the month incurred. Monthly fixed manufacturing overhead includes $150 in depreciation. During April, Iguana plans to pay $3,000 for a piece of equipment.
March .... 275
April .... 250
May .... 300
June .... 400
July .... 375
August .... 425
Required:
Prepare the following for Iguana for quarter 2:
1. Budgeted cash receipts. Include each month (April–June) as well as quarter 2 totals.
2. Budgeted cash payments.
3. Cash budget. Assume the company can borrow in increments of $1,000 to maintain a $10,000 minimum cash balance.
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Related Book For
Managerial Accounting
ISBN: 978-0078025518
2nd edition
Authors: Stacey Whitecotton, Robert Libby, Fred Phillips
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