Problem
Moorcroft Company's budgeted sales and direct materials purchases are as follows:
|
|
Budgeted Sales
|
Budgeted D.M. Purchases
|
|
April
|
$293,000
|
$46,000
|
|
May
|
343,000
|
58,000
|
|
June
|
386,000
|
65,000
|
Moorcroft's sales are 40% cash and 60% credit. Credit sales are collected 20% in the month of sale, 50% in the month following sale, and 26% in the second month following sale; 4% are uncollectible. Moorcroft's purchases are 50% cash and 50% on account. Purchases on account are paid 40% in the month following the purchase and 60% in the second month following the purchase.
How can I prepare the schedule of expected payments for direct materials for June?