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 $24,000 is paid for computer services. Sales revenue is forecast as follows

Month	Sales Revenue
February	$180,000
March	220,000
April	230,000
May	270,000
June	250,000
July	290,000

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

Timber Company
Schedule of Cash Disbursements
April, May, and June
	April	May	June
Lumbers purchases	$Answer	$Answer	$Answer
Wages	Answer	Answer	Answer
Operating expenses	Answer	Answer	Answer
Lease payment	Answer	Answer	Answer
Total disbursements	$Answer	$Answer	$Answer

Answer 1

Timber Company
Schedule of cash disbursements
April, may and June
	April	May	June
Lumbers Purchases	1,54,000	1,61,000	1,61,000
	(220000X70%)	(230000X70%)	(270000X70%)
Wages	34,500	40,500	37,500
	(230000X15%)	(270000X15%)	(250000X15%)
Operating Expenses	22,000	23,000	27,000
	(220000X10%)	(230000X10%)	(270000X10%)
Lease payment	24,000	24,000	24,000
Total Disbursements	2,34,500	2,48,500	2,49,500