Schedule of Cash Payments for a Service Company EastGate Physical Therapy Inc. i
ID: 2404365 • Letter: S
Question
Schedule of Cash Payments for a Service Company
EastGate Physical Therapy Inc. is planning its cash payments for operations for the first quarter (January–March). The Accrued Expenses Payable balance on January 1 is $26,200. The budgeted expenses for the next three months are as follows:
Other operating expenses include $3,300 of monthly depreciation expense and $800 of monthly insurance expense that was prepaid for the year on May 1 of the previous year. Of the remaining expenses, 80% are paid in the month in which they are incurred, with the remainder paid in the following month. The Accrued Expenses Payable balance on January 1 relates to the expenses incurred in December.
Prepare a schedule of cash payments for operations for January, February, and March. Enter all amounts as positive numbers.
January February March Salaries $60,300 $73,400 $81,200 Utilities 5,000 5,500 6,600 Other operating expenses 45,800 49,900 55,000 Total $111,100 $128,800 $142,800Explanation / Answer
Schedule of cash payments :
Particulars
January
February
March
salaries
60300
73400
81200
utilities
5000
5500
6600
Other operating expenses
59560
44980
49880
TOTAL
124860
123880
137680
Working notes for Operating expenses :
January
February
March
Incurred in current month
33360 [(45800-3300-800)*80%]
36640 [(49900-3300-800)*80%]
40720 [(55000-3300-800)*80%]
Incurred in previous month
26200
8340 (41700*20%)
9160 (45800*20%)
59560
44980
49880
Schedule of cash payments :
Particulars
January
February
March
salaries
60300
73400
81200
utilities
5000
5500
6600
Other operating expenses
59560
44980
49880
TOTAL
124860
123880
137680
Working notes for Operating expenses :
January
February
March
Incurred in current month
33360 [(45800-3300-800)*80%]
36640 [(49900-3300-800)*80%]
40720 [(55000-3300-800)*80%]
Incurred in previous month
26200
8340 (41700*20%)
9160 (45800*20%)
59560
44980
49880
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