Question
Question 1 The following data and estimates are available for AGT Ltd for June, July and August: June July August Sales $45,000 $50,000 $60,000 Wages
Question 1
The following data and estimates are available for AGT Ltd for June, July and August:
June
July
August
Sales
$45,000
$50,000
$60,000
Wages
$12,000
$13,000
$14,500
Overheads
$8,500
$9,500
$9,000
The following information is available regarding direct materials:
June
July
August
September
Opening stock
$5,000
$3,500
$6,000
$4,000
Material usage
$8,000
$9,000
$10,000
Notes:
1. 10% of sales are for cash, the balance is received the following month. The amount
received in June for May's sales is $29,500.
2. Wages are paid in the month they are incurred.
3. Overheads include $1,500 per month for depreciation. Overheads are settled in the month
following. May's overheads amounted to $6500.
4. Purchases of direct materials are paid for in the month purchased.
5. The opening cash balance in June is $11,750.
6. A tax bill of $25,000 is to be paid in July.
:
how do i Prepare the Direct Materials Purchases budget for the months June, July and August.
i am feeling lost please explain
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