Young co. has budgeted its activity for december according to the following information: 1. sales at $600,000, all for cash. 2. budgeted depreciation for december is $15,000. 4. the cash balance at december 1 was $15,000. 5. selling and administrative expenses are budgeted at $60,000 for december and are paid for in cash. 6. the planned merchandise inventory on december 31 and december 1 is $18,000. 7. the invoice cost for merchandise purchases represents 75% of the sales price. all purchases are paid in cash. how much are the budgeted cash disbursements for december?

The answer is: Total budgeted cash disbursement for December is $510,000.

Explanation:

Please find the below for detailed explanation and calculations:

Activities listed in the questions causes cash outflow for Young Co., i.e cash disbursement in December are:

+ Selling and administrative expense: Budgeted at $60,000 and all paid in cash;

+ Merchandise purchase which is all paid in cash: Budgeted sales in December x 75% = 600,000 x 75% = $450,000.

Thus, total projected cash disbursement for December = Selling and administrative expense Merchandise purchase = 450,000 + 60,000 = $510,000.

the answer is a.

by: nicholas dooley

answer; private store;