Question

The Glasgow Corporation’s purchases from suppliers in a quarter are equal to 75 percent of the next quarter’s forecast sales. The payables period is 60 days. Wages, taxes, and other expenses are 15 percent of sales and interest and dividends are $80 per quarter. No capital expenditures are planned.

Here are the projected quarterly sales:

	Q1			Q2			Q3			Q4
Sales	$	2,310		$	2,610		$	2,310		$	2,010

Sales for the first quarter of the following year are projected at $2,640. Calculate the company’s cash outlays by completing the following: (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

Q1 Q2 Q3 Q4

Payment of Accounts

Wages, Taxes and other Expenses

Long term financing expenses (interest and dividends)

Total

Answer 1