Cave Hardware\'s forecasted sales for April; May; June; and July are $ 200 comma

Question

Cave Hardware's forecasted sales for April; May; June; and July are $ 200 comma 000$200,000; $ 220 comma 000$220,000; $ 160 comma 000$160,000; and $ 240 comma 000$240,000; respectively. Sales are 7070% cash and 3030% credit with all accounts receivables collected in the month following the sale. Cost of goods sold is 8080% of sales and ending inventory is maintained at $ 50 comma 000$50,000 plus 2020% of the following month's cost of goods sold. All inventory purchases are paid 2828% in the month of purchase and 7272% in the following month. What is the balance of accounts payable on the June 30 budgeted balance sheet at Cave Hardware?

Explanation / Answer

Cost of goods sold for June 128000 =160000*80% Add: Ending inventory 88400 =50000+(240000*80%*20%) Less: Beginning inventory 75600 =50000+(128000*20%) Purchases 140800 Balance of accounts payable on the June 30 budgeted balance sheet = 140800*72%= 101376

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