All That Remains Products has projected sales for next year
of:
| Q1 | Q2 | Q3 | Q4 | |||||||||
| Sales | $ | 75,400 | $ | 79,325 | $ | 86,200 | $ | 92,760 | ||||
The company places orders each quarter that are 46 percent of the
following quarter's sales and has a 60-day payables period. What is
the accounts payable balance at the end of the third quarter?
| Calculate accounts payable balance at end of third quarter | ||||
| Q1 | Q2 | Q3 | ||
| Purchases | $36,489.50 | $39,652.00 | $42,669.60 | |
| 79325*46% | 86200*46% | 92760*46% | ||
| The payable period is 60 days and assuming purchases are made at beginning of the period | ||||
| Account payable at end of 3rd quarter | 42669.60*(60/90) | |||
| Account payable at end of 3rd quarter | $28,446.40 | |||
| Thus, accounts payable balance at the end of third quarter is $28,446.40 | ||||
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