Ultravision Inc. anticipates sales of $290,000 from January through April. Mater
ID: 2718589 • Letter: U
Question
Ultravision Inc. anticipates sales of $290,000 from January through April. Materials will represent 50 percent of sales, and because of level production, material purchases will be equal for each month during the four months of January, February, March, and April.
Materials are paid for one month after the month purchased. Materials purchased in December of last year were $25,000 (half of $50,000 in sales). Labor costs for each of the four months are slightly different due to a provision in the labor contract in which bonuses are paid in February and April. The labor figures are:
15,000
Prepare a schedule of cash payments for January through April. (Assume the $290,000 of sales occur equally over the four months of January through April, i.e. Monthly sales = $290,000 / 4.)
Ultravision Inc. anticipates sales of $290,000 from January through April. Materials will represent 50 percent of sales, and because of level production, material purchases will be equal for each month during the four months of January, February, March, and April.
Materials are paid for one month after the month purchased. Materials purchased in December of last year were $25,000 (half of $50,000 in sales). Labor costs for each of the four months are slightly different due to a provision in the labor contract in which bonuses are paid in February and April. The labor figures are:
Explanation / Answer
Ultravision Inc.
Cash Payment Schedule
December
January
February
March
April
Monthly material purchase
$ 25000
$36250
$ 36250
$36250
$ 36250
Payments:
Payment for material purchases
-
25000
36250
36250
36250
Monthly labor cost
-
15000
18000
15000
20000
Monthly fixed overhead
-
11000
11000
11000
11000
Total cash payments
25000
$51000
$65250
$62250
$ 67250
SINCE ALL INFORMATION FOR DECEMBER CASH PAYMENTS ARE NOT GIVEN, THUS ASSUMED NIL
Ultravision Inc.
Cash Payment Schedule
December
January
February
March
April
Monthly material purchase
$ 25000
$36250
$ 36250
$36250
$ 36250
Payments:
Payment for material purchases
-
25000
36250
36250
36250
Monthly labor cost
-
15000
18000
15000
20000
Monthly fixed overhead
-
11000
11000
11000
11000
Total cash payments
25000
$51000
$65250
$62250
$ 67250
SINCE ALL INFORMATION FOR DECEMBER CASH PAYMENTS ARE NOT GIVEN, THUS ASSUMED NIL
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.