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20 March, 20:42

Exercise 20-19 Budgeted cash payments LO P2 Zisk Co. purchases raw materials on account. Budgeted purchase amounts are: April, $80,000; May, $110,000; and June, $120,000. Payments are made as follows: 70% in the month of purchase and 30% in the month after purchase. The March 31 balance of accounts payable is $22,000. Prepare a schedule of budgeted cash payments for April, May, and June.

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  1. 20 March, 23:43
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    See explanation section.

    Explanation:

    P2 Zisk Co.

    Budgeted cash payments

    For the 2nd quarter

    April May June

    Accounts payable $22,000

    70% in the month of purchase $56,000 $77,000 $84,000

    30% in the month after purchase $24,000 $33,000

    Budgeted cash payments $78,000 $101,000 $117,000

    Total budgeted cash for the 2nd quarter = $296,000.

    30% in the month after purchase means 30% amount will be given in the following month.
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