Question

Zisk Co. purchases raw materials on account. Budgeted purchase amounts are: April, \(80,000; May, \)110,000; and June, \(120,000. Payments are made as follows: 70% in the month of purchase and 30% in the month after purchase. The March 31 balance of accounts payable is \)22,000. Prepare a schedule of budgeted cash payments for April, May, and June

Short answer

The budgeted cash payment for the month of April, May and June will be $78,000, $101,000 and $117,000.

Step-by-step solution

Preparation of the schedule

Zisk Co
Schedule of budgeted cash payments
For the month of April, May and June
Particulars	April	May	June
Current month purchase	$56,000	$77,000	$84,000
Add: Prior month purchase	$22,000	$24,000	$33,000
Budgeted cash payment	$78,000	$101,000	$117,000

Working notes

Budgeted cash payments
Particulars	April	May	June
Current month @70%	$56,000	$77,000	$84,000
Credit sales @30%	$24,000	$33,000	$36,000
Total sales	$80,000	$110,000	$120,000