Question
Part #1: At the beginning of October, L Company had 1,600 finished goods units. Budgeted sales for October, November, December, and January are 8,400 units
Part #1: At the beginning of October, L Company had 1,600 finished goods units. Budgeted sales for October, November, December, and January are 8,400 units and 10,200 units and 13,600 units and 7,400 units respectively. L Company wants to have sufficient units on hand at the end of each month to meet 20 percent of the following months budgeted sales. Prepare a Production Budget with columns for October, November, December and Total 4th Quarter. Part #2: K Company is planning its cash disbursements for the upcoming months. In June, it anticipates $72,000 in Purchases, $130,000 in Payroll, and $40,000 in Loan Payments. In July, it anticipates $79,000 in Purchases, $140,000 in Payroll, and $35,000 in Loan Payments. In August, it anticipates $80,000 in Purchases, $150,000 in Payroll, and $30,000 in Loan Payments. Purchases are usually paid 40 percent in the current month and 60 percent in the following month. Payroll is paid 80 percent in the current month and 20 percent in the following month. Loan Payments are paid in the month due. Prepare a schedule of cash disbursements for the month of July only.
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