Finch Company June Cash Payments: Calculation and Analysis

To calculate the cash payments expected for the month of June for Finch Company, we need to consider the payments for manufacturing costs, insurance expense, and property tax expense that are due in June.

Manufacturing costs:

• $217,600 total manufacturing costs in June
• 75% of costs are paid in the month they are incurred: 0.75 x $217,600 = $163,200
• 25% of costs are paid in the following month: 0.25 x $217,600 = $54,400

Insurance expense:

• $1,000 insurance expense in June
• Insurance is paid four times a year, in the first month of the quarter
• Finch paid for insurance in April (Q2), so no insurance payment is due in June

Depreciation expense:

• $2,000 depreciation expense in June

Property tax expense:

• $500 property tax expense in June
• Property tax is paid once a year in November, so no property tax payment is due in June

Total cash payments expected in June: $163,200 (manufacturing costs paid in June) + $54,400 (manufacturing costs paid in July) + $2,000 (depreciation expense) + $500 (property tax expense) = $220,100

Therefore, the answer is not one of the options provided. The closest answer is (c) $212,000, which is the total manufacturing costs and insurance expense in June, but it does not include the depreciation and property tax expenses.