estate corp., has the following information: month budgeted purchases january $26,800 february 29,000 march 28,500 april 29,480 may 26,680 purchases are paid for in the following manner: 10% of the purchase amount in the month of purchase 50% of the purchase amount in the month after purchase 40% of the purchase amount in the second month after purchase what is the expected accounts payable balance as of may 31?

Answer 1

To calculate the expected accounts payable balance as of May 31, we need to determine the amounts that are paid in each month after the purchase.

For the January purchases, 10% is paid in the month of purchase, which is $26,800 * 10% = $2,680.
Then, 50% is paid in the month after purchase, which is $26,800 * 50% = $13,400.
Finally, 40% is paid in the second month after purchase, which is $26,800 * 40% = $10,720.

For the February purchases, 10% is paid in the month of purchase, which is $29,000 * 10% = $2,900.
Then, 50% is paid in the month after purchase, which is $29,000 * 50% = $14,500.
Finally, 40% is paid in the second month after purchase, which is $29,000 * 40% = $11,600.

For the March purchases, 10% is paid in the month of purchase, which is $28,500 * 10% = $2,850.
Then, 50% is paid in the month after purchase, which is $28,500 * 50% = $14,250.
Finally, 40% is paid in the second month after purchase, which is $28,500 * 40% = $11,400.

For the April purchases, 10% is paid in the month of purchase, which is $29,480 * 10% = $2,948.
Then, 50% is paid in the month after purchase, which is $29,480 * 50% = $14,740.
Finally, 40% is paid in the second month after purchase, which is $29,480 * 40% = $11,792.

For the May purchases, 10% is paid in the month of purchase, which is $26,680 * 10% = $2,668.
Then, 50% is paid in the month after purchase, which is $26,680 * 50% = $13,340.
Finally, 40% is paid in the second month after purchase, which is $26,680 * 40% = $10,672.

Now, let's calculate the total expected accounts payable balance as of May 31 by adding up the amounts:
$2,680 + $13,400 + $10,720 + $2,900 + $14,500 + $11,600 + $2,850 + $14,250 + $11,400 + $2,948 + $14,740 + $11,792 + $2,668 + $13,340 + $10,672 = $145,218.

The expected accounts payable balance as of May 31 is $145,218.