Sage learning systems inc. was organized on September 30, 2012. Projected sellin

Question

Sage learning systems inc. was organized on September 30, 2012. Projected selling and administrative expenses for each of the first three months of operations are as follows:
October $67,500
November 75,000
December 88,100
Depreciation, insurance, and property taxes represent $9,000 of the estimated monthly expenses. The annual insurance premium was paid on September 30, and the property taxes for the year will be paid in june. 60% of the remainder of the expenses are expected to be paid in the month in which they incurred, with the balance to be paid in the following month. Prepare a schedule indicating cash payments for selling and administrative expenses for October, November, December.

Explanation / Answer

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Please find the answer as follows:

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October November December Monthly Cash Expense 35100 39600 47460 Payments Next Month 0 23400 26400 Total Cash Payments for Selling and Administrative Expenses 35100 63000 73860

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