e month of purchase and 20% n the mo a er purchase. The Accounts Payable balance

Question

e month of purchase and 20% n the mo a er purchase. The Accounts Payable balance on Yem Company budgeted direct materials purchases of S 192.250 in January and $138.950 in February. Assume Yem pays or direct materials purchases 80% i January 1 is $50,000. Prepare a schedule of cash payments for purchases for January and February. Round to the nearest dolla Begin by computing the total cash payments for direct materials for January and February. Then, compute the Accounts Payable balance at February 28. (Round all amounts you enter into the budget to the nearest whole dollar. If a bax is not used in the table leave the box empty, do not enter a zero.) Cash Payments JanuaryFebruany Total direct materials purchases January February Cash Payments Direct Materials: Accounts Payable balance, January 1 Jan-Jan, direct material purchases paid in Jan n-Jan. direct materi al purchases paid in Feb d in Feb Total payments for direct materials Accounts Payable balance, February 28 -Feb. direct material in Mar

Explanation / Answer

Cash payment :

Account payable balance, february 28

Feb-feb direct material purchases paid in mar = (138950*20%) = 27790

January February Total direct material purchase 192250 138950 January February Cash payments Direct material: Account payable 50000 Jan-Jan direct material purchase paid in jan 153800 Jan-Jan direct material purchase paid in feb 38450 Feb-Jan direct material purchase paid in feb 111160 Total payments for direct materials 203800 149610

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