Question

Estate Corp., has the following information: Month Budgeted Purchases January $27,600 February 29,400 March 28,500 April 30,480 May 27,680 Purchases are paid for in the following manner: 15% of the purchase amount in the month of purchase 35% of the purchase amount in the month after purchase 50% of the purchase amount in the second month after purchase What is the expected Accounts Payable balance as of May 31

Answer 1

$38,768

Step-by-step explanation:

January Purchases:

$27,600

January Payments:

15% of $27,600 = $4,140

February Purchases:

$29,400

February Payments:

15% of $29,400 = $4,410

35% of $27,600 = $9,660

Total February Payments = $4,410 + $9,660 = $14,070

March Purchases:

$28,500

March Payments:

15% of $28,500 = $4,275

35% of $29,400 = $10,290

50% of $27,600 = $13,800

Total March Payments = $4,275 + $10,290 + $13,800 = $28,365

April Purchases:

$30,480

April Payments:

15% of $30,480 = $4,572

35% of $28,500 = $9,975

50% of $29,400 = $14,700

Total April Payments = $4,572 + $9,975 + $14,700 = $29,247

May Purchases:

$27,680

May Payments:

15% of $27,680 = $4,152

35% of $30,480 = $10,668

50% of $28,500 = $14,250

Total May Payments = $4,152 + $10,668 + $14,250 = $29,070

Total Purchases = $27,600 + $29,400 + $28,500 + $30,480 + $27,680

Total Purchases = $143,660

Total Payments = $4,140 + $14,070 + $28,365 + $29,247 + $29,070

Total Payments = $104,892

Accounts Payable = Total Purchases - Total Payments

Accounts Payable = $143,660 - $104,892

Accounts Payable = $38,768