Fedor, Inc. has prepared the following direct materials purchases budget: Month Budgeted DM Purchases June $ 69 comma 000 July 80 comma 000 August 77 comma 500 September 77 comma 900 October 71 comma 800 All purchases are paid for as follows: 10 % in the month of purchase, 40 % in the following month, and 50 % two months after purchase. Calculate total budgeted cash payments made in October for purchases. A. $ 69 comma 910 B. $ 38 comma 340 C. $ 77 comma 090 D. $ 45 comma 930

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Villarreal

Business

2 February, 02:16

Fedor, Inc. has prepared the following direct materials purchases budget: Month Budgeted DM Purchases June $ 69 comma 000 July 80 comma 000 August 77 comma 500 September 77 comma 900 October 71 comma 800 All purchases are paid for as follows: 10 % in the month of purchase, 40 % in the following month, and 50 % two months after purchase. Calculate total budgeted cash payments made in October for purchases. A. $ 69 comma 910 B. $ 38 comma 340 C. $ 77 comma 090 D. $ 45 comma 930

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Stevens · Answer 1

C) $77,090

Explanation:

June 69000 (40% in July, 50% in AUgust)

July 80000 (40% in August, 50% in Sepetember)

August 77500 (40% in September, 50% in October)

September 77900 (40% in October)

October 71800 (10% in October)

Total budgeted cash payments in October = 71,800 x 10% + 77,900 x 40% + 77,500 x 50% = 77,090