Estimated current payables balance


Question 1. Wateredge Corporation has budgeted a total of $361,800 in costs and expenses for the upcoming quarter. Of this amount, $45,000 represents depreciation expense and $7,300 represents the expiration of prepayments. Wateredge's current payables balance is $265,000 at the beginning of the quarter. Budgeted payments on current payables for the quarter amount to $370,000. The company's estimated current payables balance at the end of the quarter is:

A. $179,500.
B. $204,500.
C. $203,500.
D. $310,000.

Question 2. On October 1 of the current year, Molloy Corporation prepared a cash budget for October, November, and December. All of Molloy's sales are made on account. The following information was used in preparing estimated cash collections:

Approximately 60% of all sales are collected in the month of the sale, 30% is collected in the following month, and 10% is collected in the month thereafter.

August sales (actual)          $40,000
September sales (actual)     $50,000
October sales (estimated)     $20,000
November sales (estimated)  $70,000
December sales (estimated)   $60,000

Budgeted collections from customers in October total:

A. $39,000.
B. $27,000.
C. $31,000.
D. $110,000.

Question 3. Skelton Corporation had planned to produce 50,000 units of product during the first quarter of the current year. The company prepared the following budget on May 1:

During the first quarter, Carson produced 60,000 units and incurred total manufacturing costs of $180,000.

Refer to the information above. Which of the following amounts should not be included in Skelton's flexible budget at a 60,000-unit level?

A. Direct materials used, $43,200.
B. Direct labor, $54,000.
C. Variable overhead, $27,000.
D. Fixed manufacturing overhead, $70,200.

Solution Preview :

Prepared by a verified Expert
Accounting Basics: Estimated current payables balance
Reference No:- TGS01924200

Now Priced at $20 (50% Discount)

Recommended (98%)

Rated (4.3/5)