This account represents the purchases for raw materials only. It is expected that purchases will be made evenly throughout the year, and that all purchases will be paid for during the month following the purchase.
2006 WAGE AND SALARY INFORMATION
The accrued wage account will include all direct labor, indirect labor, sales commissions and salaries, and administrative salaries. All wages are earned evenly throughout the year, and employees are paid twice each month. On December 31, 2006, the accrued wages will include wages representing one full payroll period.
2006 ACCRUED OTHER INFORMATION
This account includes all other cash expenses not included in Account Payable and Accrued Wages. It is the company ' s policy to pay all other expenses during the month following the purchase. These expenses will be incurred evenly throughout the year. The 20 % fringe benefits will be paid on all wages, salaries, and commissions.
2006 PROPERTY, PLANT AND EQUIPMENT INFORMATION
Property, plant and equipment consist of the following on December 31, 2005:
Property and plant $ 750,000 Equipment 1,025,000 Total Property, Plant and Equipment $ 1,775,000
Each additional machine that is needed to support the production level expected during 2006 will cost $ 30,000 and be depreciated over five