The company's total cash payments in May is $195,500 and this can be determined by preparing a cash budget.
<h3>What is a cash budget?</h3>
A cash budget is a company's estimation of its cash inflows and outflows over a specified period of time. A cash budget provides a company with financial insight into its cash requirements, including shortages and surpluses. The preparation of a cash budget helps the company to determine an efficient use of its available cash.
Data and Calculations:
April May June July
Anticipated sales $300,000 $300,000 $300,000 $300,000
Purchases 150,000 $150,000 150,000 150,000
Labor costs 16,000 19,000 16,000 21,000
Fixed overhead 12,000 12,000 12,000 12,000
General and admin. exp. 2,000 2,000 2,000 2,000
Interest expense 2,500
Equipment purchase 10,000
Total cash payments in May $195,500
Thus, the company's total cash payments in May is $195,500.
Learn more about cash budgets at brainly.com/question/8707644
