A Company Has Budgeted Direct Materials Purchases of $300,000 in July

question 18

Multiple Choice

A company has budgeted direct materials purchases of $300,000 in July and $480,000 in August. Past experience indicates that the company pays for 70% of its purchases in the month of purchase and the remaining 30% in the next month. During August, the following items were budgeted: $$\begin{array} { l r } \text { Wages Expense } & \$ 150,000 \\\text { Purchase of office equipment } & 72,000 \\\text { Selling and Administrative Expenses } & 48,000 \\\text { Depreciation Expense } & 36,000\end{array}$$ The budgeted cash disbursements for August are

• A) $648,000.
• B) $426,000.
• C) $696,000.
• D) $732,000.

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Definitions:

Correct Case

The appropriate or accurate grammatical case (nominative, accusative, etc.) used in a language.

Capitalization

The use of uppercase letters at the beginning of sentences or proper nouns; also refers to the total value of a company's shares on the stock market.

Microcomputers

Small-scale computers designed for individual use, offering processing capabilities for software applications and internet access, typical examples include personal computers and laptops.

Fourth Of July

This term refers to Independence Day in the United States, a federal holiday commemorating the adoption of the Declaration of Independence on July 4, 1776.