Exercise 20-11 Merchandising: Budgeted cash disbursements LO P1

Hector Company reports the following:

July August September
Sales $ 19,000 $ 27,000 $ 31,000
Purchases 11,210 15,930 19,000

Payments for purchases are made in the month after purchase. Selling expenses are 20% of sales, administrative expenses are 10% of sales, and both are paid in the month of sale. Rent expense of $2,000 is paid monthly. Depreciation expense is $1,600 per month.

Prepare a schedule of budgeted cash disbursements for August and September.