isk Co. purchases raw materials on account. Budgeted purchase amounts are April, $96,000; May, $126,000; and June, $136,000. Payments are made as follows: 70% in the month of purchase and 30% in the month after purchase. The March 31 balance of accounts payable is $38,000. Prepare a schedule of budgeted cash payments for April, May, and June.

Given that Payments are made as follows: 70% in the month of purchase and 30% in the month after purchase, therefore, firstly we need to differentiate the total amount of purchases of each month into 70% and 30%. 70% of the purchases will be paid in current month and balance 30% of the purchases will be ending accounts payable for that month and paid in next month. This is shown as follows:

Particulars                                         April         May          June

Current month purchases  70%$67,200  $88,200    $95,200

Ending accounts payable   30%   $28,800   $37,800    $40,800

Total purchases                             $96,000  $126,000  $136,000

The schedule of budgeted cash payments for the month of April May and June are shown as follows:-

                            Schedule of Cash Payments    

                               For April, May, and June

                                                                      April           May         June

Cash payments for:

Current month purchases                          $67,200   $88,200   $95,200  

Prior month purchases                               $38,000   $28,800   $37,800

Budgeted cash payments for materials  $105,200 $117,000  $133,000

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