Excel Learning Systems Inc. was organized on September 30, 2016. Projected selli
ID: 2541887 • Letter: E
Question
Excel Learning Systems Inc. was organized on September 30, 2016. Projected selling and administrative expenses for each of the first three months of operations are as follows:
Depreciation, insurance, and property taxes represent $25,000 of the estimated monthly expenses. The annual insurance premium was paid on September 30, and property taxes for the year will be paid in June. The company expects that 69% of the remainder of the expenses will be paid in the month in which they are incurred, with the balance to be paid in the following month.
Prepare a schedule indicating cash payments for selling and administrative expenses for October, November, and December.
October $119,200 November 110,900 December 100,900Explanation / Answer
Required schedule is as prepared below:
Excel Systems Inc. Schedule of Cash Payments for Selling and Administrative Expenses For the Three Months Ending December 31, 2016 October November December October expenses: Paid in October 64,998 Paid in November 29,202 November expenses: Paid in November 59,271 Paid in December 26,629 December expenses: Paid in December 52,371 Total cash payments 64,998 88,473 79,000 October Expenses (119,200-25,000) 94,200 94,200*69% 94,200*31% November Expenses (110,900-25,000) 85,900 85,900*69% 85,900*31% December Expenses (100,900-25,000) 75,900 75,900*69% 75,900*31%Related Questions
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