Finch Company began its operations on March 31 of the current year. Finch has th

Question

Finch Company began its operations on March 31 of the current year. Finch has the following projected costs: April May June Manufacturing costs (1) Insurance expense (2) Depreciation expense Property tax expense (3) $155,600 $199,200 $215,200 1,10 1,89 50 1,10 1,89 50 1,10 1,89 50 (1) Of the manufacturing costs, three-fourths are paid for in the month they are incurred; one-fourth is paid in the following month (2) Insurance expense is $1,100 a month; however, the insurance is paid four times yearly in the first month of the quarter, (i.e., January, April, July, and October) (3) Property tax is paid once a year in November. The cash payments expected for Finch Company in the month of April are $120,000 O$116,700 $137,800 $155,600

Explanation / Answer

Manufacturing costs 116700 =155600*75% Insurance expense 3300 =1100*3 Cash payments 120000 Option 1 is correct

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