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Schedule of Cash Payments for a Service Company SafeMark Financial Inc. was organized on February 28....

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Accounting

Schedule of Cash Payments for a Service Company

SafeMark Financial Inc. was organized on February 28. Projectedselling and administrative expenses for each of the first threemonths of operations are as follows:

March$147,500
April137,200
May124,900

Depreciation, insurance, and property taxes represent $31,000 ofthe estimated monthly expenses. The annual insurance premium waspaid on February 28, and property taxes for the year will be paidin June. 70% of the remainder of the expenses are expected to bepaid in the month in which they are incurred, with the balance tobe paid in the following month.

Prepare a schedule indicating cash payments for selling andadministrative expenses for March, April, and May.

SafeMark Financial Inc.
Schedule of Cash Payments for Selling andAdministrative Expenses
For the Three Months Ending May 31
MarchAprilMay
March expenses:
Paid in March$
Paid in April$
April expenses:
Paid in April
Paid in May$
May expenses:
Paid in May
Total cash payments$$

$

Answer & Explanation Solved by verified expert
4.1 Ratings (683 Votes)

SafeMark Financial Inc
Schedule of Cash Payments for selling and administrative expenses
For the Three Months Ending May 31
March April May
March Expenses
Paid in March ($147,500-$31,000)*70% = $81,550
Paid in April ($147,500-$31,000)*30% = $34,950
April Expenses
Paid inApril ($137,200-$31,000)*70% = $74,340
Paid in May ($137,200-$31,000)*30% = $31,860
May Expenses
Paid May ($124,900-$31,000)*70% = $65,730
Total cash payments $                                                        81,550 $                                                      109,290 $                                                        97,590

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