Question 1

Preparing an Accounts Payable Schedule

Wight Inc. purchases raw materials on account for use in production. The direct materials purchases budget shows the following expected purchases on account:

April	$374,800
May	411,300
June	415,600

Wight typically pays 25% on account in the month of billing and 75% the next month.

Required:

1. How much cash is required for payments on account in May? $

2. How much cash is expected for payments on account in June? $

Question 2

Schedule of Cash Collections on Accounts Receivable and Cash Budget

Lopez Inc. found that about 25% of its sales during the month were for cash. Lopez has the following accounts receivable payment experience:

Percent paid in the month of sale	25
Percent paid in the month after the sale	68
Percent paid in the second month after the sale	5

Lopez's anticipated sales for the next few months are as follows:

April	$250,000
May	290,000
June	280,000
July	295,000
August	300,000

Required:

1. Calculate credit sales for May. $

Calculate credit sales for June. $

Calculate credit sales for July. $

Calculate credit sales for August. $

2. Prepare a schedule of cash receipts for July and August. Round your answer to the nearest whole dollar, if necessary. If an amount box does not require an entry, leave it blank or enter "0". Be sure to enter percentages as whole numbers.

Bennett Inc. Schedule of Cash Receipts For July and August
				July		August
Cash sales				$		$
Payments on account:
From May credit sales:
$ %
From June credit sales:
$ %
$ %
From July credit sales:
$ %
$ %
From August credit sales:
$ %
Cash receipts				$		$