Baird is a retail company specializing in men’s hats. Its budget director prepared the list of expected operating expenses that follows. All items are paid when incurred except sales commissions and utilities, which are paid in the month following their incurrence. July is the first month of operations, so there are no beginning account balances.
July | August | September | |||||||
Salary expense | $ | 17,700 | $ | 17,700 | $ | 17,700 | |||
Sales commissions (4 percent of sales) | 1,900 | 1,900 | 1,900 | ||||||
Supplies expense | 360 | 390 | 420 | ||||||
Utilities | 2,900 | 2,900 | 2,900 | ||||||
Depreciation on store equipment | 2,600 | 2,600 | 2,600 | ||||||
Rent | 6,500 | 6,500 | 6,500 | ||||||
Miscellaneous | 660 | 660 | 660 | ||||||
Total S&A expenses before interest | $ | 32,620 | $ | 32,650 | $ | 32,680 |
Required Prepare a schedule of cash payments for selling and administrative expenses. Determine the amount of utilities payable as of September 30. Determine the amount of sales commissions payable as of September 30. |
Baird, a Retail Company | |||
Schedule of Cahs Payment for Selling and Administrative Expense | |||
July | August | September | |
Salary Expense | $17,700 | $17,700 | $17,700 |
Sales Comission (4% of Sales) | $1,900 | $1,900 | |
Supplies Expense | $360 | $390 | $420 |
Utilities | $0 | $2,900 | $2,900 |
Rent | $6,500 | $6,500 | $6,500 |
Miscellaneous | $660 | $660 | $660 |
Total Payment | $25,220 | $30,050 | $30,080 |
b. The Amount of Utilities Payment as of September 30 will be $2900 | |||
b. The Amount of Sales Comission as of September 30 will be $1900 |
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