Question

quetzaltenango candle inc. pays 30% of its purchases on account in the month of the purchase and 70% in the month following the purchase. if purchases are budgeted to be $50,000 for august and $60,000 for september, what are the budgeted cash payments for purchases on account for september? quetzaltenango candle inc. schedule of cash payments for purchases for the month ending september line item description amount $- select - - select - total payments for purchases on account $total payments for purchases on account

Answer 1

For September, Quetzaltenango Candle Inc.’s budgeted cash payments for purchases on account include $35,000 for August purchases and $18,000 for September purchases, totaling $53,000.

Step-by-step explanation:

To calculate the budgeted cash payments for purchases on account for Quetzaltenango Candle Inc. for the month of September, we must consider the company's payment structure as well as the budgeted purchases for August and September. According to the company's policy, 30% of purchases are paid in the month of purchase, and the remaining 70% are paid in the following month.

For August purchases of $50,000, the payments in September would be 70% of that amount, which equals $35,000. In addition, the company would also pay 30% of September's budgeted purchases of $60,000, which equals $18,000. Therefore, the total budgeted cash payments for September would be the sum of these two amounts, which is $35,000 + $18,000 = $53,000.

Here's the breakdown:

• Payment for August purchases in September: $50,000 x 70% = $35,000
• Payment for September purchases in September: $60,000 x 30% = $18,000
• Total payments for purchases on account in September: $35,000 + $18,000 = $53,000

Answer 2

The budgeted cash payments for Quetzaltenango Candle Inc. for September include 70% of August's purchases ($35,000) and 30% of September's purchases ($18,000), totaling $53,000.

Step-by-step explanation:

To calculate the budgeted cash payments for purchases on account for Quetzaltenango Candle Inc. for the month of September, we need to consider purchases made in both August and September, as well as the company's payment structure.

• For the month of August, the purchases are $50,000, of which 30% is paid in August itself, and 70% in September.
• For the month of September, the purchases are $60,000, of which 30% is paid in the month of the purchase (September).

We can now make these calculations:

• Payments for August purchases in September: 70% of $50,000 = $35,000
• Payments for September purchases in September: 30% of $60,000 = $18,000

Adding both payments together:

$35,000 (August purchases) + $18,000 (September purchases) = $53,000

Therefore, the total budgeted cash payments for purchases on account for the month of September are $53,000.