Question Two: (18 marks) (B1, C1)

Part A: (10 marks)

Ahlia, Inc. has budgeted direct materials purchases of $400,000 in March and $300,000 in April. Past experience indicates that the company pays for 40% of its purchases in the month of purchase and the remaining 60% in the next month. Other costs are all paid during the month incurred. During April, the following items were budgeted:

Wages expense $130,000

Purchase of office equipment 210,000

Selling and administrative expenses 126,000

Depreciation expense 18,000

Instructions

Compute the amount of budgeted cash disbursements for April.