Question - Paddu Company's budgeted sales and direct materials purchases follow. January was the first month of operations.
Budgeted Sales:
January $137,000; February $186,000; March $254,000
Budgeted Direct Materials Purchases:
January $42,200; February $37,300; March $42,300
Paddu's sales are 30% cash and 70% credit. It collects credit sales 45% in the month of sale, 55% in the month following the sale.
Paddu's purchases are 3S% cash and 6S% on account. It pays purchases on account 50% in the month of purchase, and 50% in the month following purchase.
Required -
Prepare a schedule of expected collections for January, February, and March.
Prepare a schedule of expected payments for direct materials for January, February and March.