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    Cash Disbursement and Cash Receipts

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    Carter Company has projected sales and production in units for the second quarter of next year as follows:

    April May June
    Sales 60,000 40,000 50,000
    Production 50,000 50,000 60,000

    Required:

    a. Cash production costs are budgeted at $6 per unit produced. Of these production costs, 40% are paid in the month in which they are incurred and the balance in the following month. Selling and administrative expenses (all of which are paid in cash) amount to $120,000 per month. The accounts payable balance on March 31 totals $192,000, all of which will be paid in April. Prepare a schedule for each month showing budgeted cash disbursements for Carter Company.

    b. Assume that all units will be sold on account for $15 each. Cash collections from sales are budgeted at 60% in the month of sale, 30% in the month following the month of sale, and the remaining 10% in the second month following the month of sale. Accounts receivable on March 31 totaled $510,000 ($90,000 from February's sales and the remainder from March). Prepare a schedule for each month showing budgeted cash receipts for Carter Company.

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    https://brainmass.com/business/cash-budgeting/cash-disbursement-and-cash-receipts-74113

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    The solution explains how to prepare a schedule of cash disbursement and cash receipts

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