Select Physical Therapy Inc. is planning its cash payments for operations for th
ID: 2702049 • Letter: S
Question
Select Physical Therapy Inc. is planning its cash payments for operations for the third quarter (July-September), 2013. The Accrued Expenses Payable balance on July 1 is $28,000. The budgeted expenses for the next three months are as follows:
July
August
September
Salaries
$63200
$78100
$84900
Utilities
5300
5600
7100
Other operating expenses
48500
52700
58200
Total
$117000
$136400
$150200
Other operating expenses include $3,500 of monthly depreciation expense and $800 of monthly insurance expense that was prepaid for the year on March 1 of the current year. Of the remaining expenses, 75% are paid in the month in which they are incurred, with the remainder paid in the following month. The Accrued Expenses Payable balance on July 1 relates to the expenses incurred in June.
Prepare a schedule of cash payments for operations for July, August, and September.
July Aug Sept
Payments of prior month's expense
Payment of current month's expense
Total payment
Explanation / Answer
july August september
opening 28000
depreciation 3500 3500 3500
total 31500 3500 3500