Acmal Manufacturing Company is estimating the following raw material purchases for the last four months of the year: September P850,000; October P900,000; November P810,000; December P780,000. At Acmal, 25% of raw materials purchases are normally paid for in the month of purchase. The remaining 75% is paid for in the month following the purchase. How much cash should Acmal expect to pay out for raw material purchases during the month of November? A. 202,500 B. 832,500 C. 852,500 D. 877,500
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Acmal Manufacturing Company is estimating the following raw material purchases for the last four months of the year: September P850,000; October P900,000; November P810,000; December P780,000. At Acmal, 25% of raw materials purchases are normally paid for in the month of purchase. The remaining 75% is paid for in the month following the purchase. How much cash should Acmal expect to pay out for raw material purchases during the month of November?
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