(Cash disbursements) In trying to decide whether it was feasible for the company to acquire treasury stock during May 1997, Jon Hardtack, president of Rocky Mountain Bootery, Inc., requested information on projected cash disbursements for that month. He received the following information from his new accountant:

Not understanding how the above information could help him compute cash disbursements, Mr. Hardtack asked the accountant to show how cash dis¬ bursements can be computed from these figures. If all significant data are given, what are projected cash disbursements for May?LO1

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Sales for May Gross profit on sales $2,000,000 40% Wages expense for May $ 412,500 Other cash expenses for May $ 235,250 Decrease in Accounts Payable during May $ 40,000 Decrease in Merchandise Inventory during May $ 33,750