Cash Disbursement Timber Company is in the process of preparing its budget for n

Question

Cash Disbursement
Timber Company is in the process of preparing its budget for next year. Cost of goods sold has been estimated at 70 percent of sales. Lumber purchases and payments are to be made during the month preceding the month of sale. Wages are estimated at 15 percent of sales and are paid during the month of sale. Other operating costs amounting to 10 percent of sales are to be paid in the month following the month of sale. Additionally, a monthly lease payment of $34,000 is paid for computer services. Sales revenue is forecast as follows

Required
Prepare a schedule of cash disbursements for April, May, and June.
Do not use a negative sign with your answers.

Month Sales Revenue February $190,000 March 230,000 April 240,000 May 280,000 June 260,000 July 300,000

Explanation / Answer

Schedule of Cash Disbursements April May June Lumber purchases 196000 182000 210000 Wages 36000 42000 39000 operatinge xpenses 23,000 24,000 28,000 lease payment 34,000 34,000 34,000 total disbursement 289000 282000 311000 April May June Lumber purchases 280000*70% 260000*70% 300000*70% Wages 240000*15% 280000*15% 260000*15% operatinge xpenses 230000*10% 240000*10% 280000*10%

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