The Bruin Corporation’s purchases from suppliers in a quarter are equal to 65 pe

Question

The Bruin Corporation’s purchases from suppliers in a quarter are equal to 65 percent of the next quarter’s forecast sales. The payables period is 60 days. Wages, taxes, and other expenses are 20 percent of sales, and interest and dividends are $113 per quarter. No capital expenditures are planned. Projected quarterly sales are: Q1 Q2 Q3 Q4 Sales $1,470 $1,620 $1,680 $1,920 Sales for the first quarter of the following year are projected at $1,590.

Calculate Bruin’s cash outlays by completing the following (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16)):

Required:

Calculate Bruin’s cash outlays by completing the following (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16)):

Explanation / Answer

ASSUMPTION : It is assumed that 65 % of sales for following quarters sales is material cost . The materrials was purchased at the ist month of the quarter is payable within the 60 days i.e payment falls due in the quarter of purcase itself.

Note : The wages taxes are payable on the current quarters sales .

THE END

Particulars Q.1 Q2 Q3 Q4 Q1.(next yr) Projected sales $ 1470 1620 1680 1920 1590 Purchase & Payment [65% of next Qtr} [$] 1053 1092 1248 1033,50 Not required Wages , taxes, other exp. of sales for the same quarter [$] 294 324 336 384 Do Long Term Financing exp in [ as giver -per quarter] 113 113 113 113 Do total cash outlays 1460 1529 1697 1530.50 Total for the year 1 6216.50

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