The Hepworth Ltd has forecast the following sales for the first seven months of the...
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Accounting
The Hepworth Ltd has forecast the following sales for the first seven months of the year.
| January | February | March | April | May | June | July |
| $14,000 | $16,000 | $18,000 | $24,000 | $14,000 | $20,000 | $22,000 |
Monthly material purchases are set equal to 38 percent of forecasted sales for the next month. Of the total material costs, 35 percent are paid in the month of purchase and 60 percent are paid in the following month. Labour costs will run $4,700 per month, and fixed overhead is $2,400 per month. Interest payments on the debt will be $1,400 for both March and June. Finally, the Hepworth Ltd sales people will receive a 3.0% commission on total sales for the first six months of the year, to be paid on June 30.
Required:
Prepare a month summary of cash payments for the six months from January through June.
Suggested format (i.e. optional)
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