Question
BigCo estimates the following production in cases for the next 4 months. Cases Jan5,000 Feb6,000 Mar 7,000 Apr 8,000 BigCo uses 20 lbs of
BigCo estimates the following production in cases for the next 4 months.
Cases
Jan5,000
Feb6,000
Mar 7,000
Apr 8,000
BigCo uses 20 lbs of direct material per case at a cost of $1.50 per pound.A company policy states that they will maintain a 10% inventory of the next month's needs. BigCo pays the vendor 80% in the month of purchase and the rest in the following month.It also receives a 2% discount on all purchases.What is the expected cash disbursement for the month of March?
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Advanced Accounting
Authors: Floyd A. Beams, Joseph H. Anthony, Bruce Bettinghaus, Kenneth Smith
11th Edition
978-0132568968, 9780132568968
