Reference no: EM132148497

Question - Finch Company began its operations on March 31 of the current year. Finch has the following projected costs:

April May June

Manufacturing costs (1) $157,100 $196,400 $213,800

Insurance expense (2) 810 810 810

Depreciation expense 1,920 1,920 1,920

Property tax expense (3) 520 520 520

(1) Of the manufacturing costs, three-fourths are paid for in the month they are incurred; one-fourth is paid in the following month.

(2) Insurance expense is $810 a month; however, the insurance is paid four times yearly in the first month of the quarter, (i.e., January, April, July, and October).

(3) Property tax is paid once a year in November.

The cash payments expected for Finch Company in the month of April are

a. $120,255

b. $157,100

c. $138,678

d. $117,825