Walsh Enterprises, Inc., is a retailer of parts for exotic automobiles. The company has budgeted parts purchases for the next three months as follows:
All purchases are made on a credit basis. The company expects that 60% of its payables related to purchases will be paid in the month of purchase, with the remaining 40% paid in the following month. The ending balance in accounts payable related to parts purchases on March 31 was $80,000. What amount of cash disbursement for parts purchases will be budgeted for May?
A) $112,800
B) $141,200
C) $93,200
D) $72,000

Question

Walsh Enterprises, Inc., is a retailer of parts for exotic automobiles. The company has budgeted parts purchases for the next three months as follows:
 All purchases are made on a credit basis. The company expects that 60% of its payables related to purchases will be paid in the month of purchase, with the remaining 40% paid in the following month. The ending balance in accounts payable related to parts purchases on March 31 was $80,000. What amount of cash disbursement for parts purchases will be budgeted for May?
A) $112,800 
B) $141,200 
C) $93,200 
D) $72,000

Quizplus · Accepted Answer

The Answer of Walsh Enterprises, Inc., is a retailer of parts for exotic automobiles. The company has budgeted parts purchases for the next three months as follows:
 All purchases are made on a credit basis. The company expects that 60% of its payables related to purchases will be paid in the month of purchase, with the remaining 40% paid in the following month. The ending balance in accounts payable related to parts purchases on March 31 was $80,000. What amount of cash disbursement for parts purchases will be budgeted for May?
A) $112,800 
B) $141,200 
C) $93,200 
D) $72,000