Question

Schedule of Cash Payments

Select Physical Therapy Inc. is planning its cash payments for operations for the third quarter (July–September), 2017. The Accrued Expenses Payable balance on July 1 is $34,300. The budgeted expenses for the next three months are as follows:

	July		August		September
Salaries	$78,900		$96,000		$106,300
Utilities	6,500		7,200		8,600
Other operating expenses	60,000		65,400		72,000
Total	$145,400		$168,600		$186,900

Other operating expenses include $4,300 of monthly depreciation expense and $1,000 of monthly insurance expense that was prepaid for the year on March 1 of the current year. Of the remaining expenses, 70% are paid in the month in which they are incurred, with the remainder paid in the following month. The Accrued Expenses Payable balance on July 1 relates to the expenses incurred in June.

Prepare a schedule of cash payments for operations for July, August, and September.

Select Physical Therapy Inc.
Schedule of Cash Payments for Operations
For the Three Months Ending September 30, 2017
	July	August	September
Payments of prior month's expense	$	$	$
Payments of current month's expense
Total payment	$	$	$

Answer 1

Select Physical Therapy Inc.
Schedule of Cash Payments for Operations
For the Three Months Ending September 30, 2017
	July	August	September
Payments of prior month's expense	34,300	42,030	48,990
	Given	(140100*30%)	(163300*30%)
Payments of current month's expense	98,070	1,14,310	1,27,120
	(140100*70%)	(163300*70%)	(181600*70%)
Total payment	1,32,370	1,56,340	1,76,110
Workings
	July	August	September
Total Expenses	1,45,400	1,68,600	1,86,900
Less:
Depreciation	-4,300	-4,300	-4,300
Insurance	-1,000	-1,000	-1,000
Net Expenses Payable in Cash	1,40,100	1,63,300	1,81,600