Question

At the beginning of the year, Duck Co.'s Accounts Payable had a credit balance of $1,300. The company made purchases of $1,700 on account. If the ending balance was a credit of $600, what were the cash payments to suppliers?

Answer 1

Duck Co. made cash payments to suppliers amounting to $2,400, calculated using the formula: Beginning Accounts Payable + Purchases on Account - Ending Accounts Payable.

Step-by-step explanation:

Calculating Cash Payments to Suppliers

To calculate the cash payments Duck Co. made to suppliers, we need to consider the company's beginning and ending accounts payable balances and the amount of purchases made on account throughout the year.

Here are the given figures:

• Beginning Accounts Payable: $1,300
• Purchases on Account: $1,700
• Ending Accounts Payable: $600

The formula for cash payments to suppliers is:

Beginning Accounts Payable + Purchases on Account - Ending Accounts Payable = Cash Payments

Using this formula, we can calculate the cash payments to suppliers:

$1,300 (Beginning Accounts Payable) + $1,700 (Purchases on Account) - $600 (Ending Accounts Payable) = $2,400 (Cash Payments to Suppliers).