The Snow Globe Emporium sells snow globes. The forecasted first quarter sales volume for the Emporium is shown in the top row of the table. The Emporium buys the snow globes from a distributor for $5 and sells them for $8. All purchases are made on credit one month in advance of sales and are paid for the month following the purchase. What are the Snow Globe Emporium's payments in March? Sales and Purchase Forecast
The Snow Globe Emporium
$$\begin{array} { | l | c | c | c | c | }
\hline & \text { January } & \text { February } & \text { March } & \text { April } \
\hline \text { Sales Forecast (units) } & 2,000 & 3,000 & 3,800 & 4,700 \
\hline \begin{array} { l }
\text { Purchases from } \
\text { Suppliers (\$) }
\end{array} & & & & \
\hline \text { Payments to Suppliers } & & & & \
\hline & & & & \
\hline \text { Beginning Accounts } & &\$15,000 & & \
\text { Payable } \
\hline \text { Ending Accounts } &\
\text { Payable }&\$15\
\hline
\end{array}$$

Question

The Snow Globe Emporium sells snow globes. The forecasted first quarter sales volume for the Emporium is shown in the top row of the table. The Emporium buys the snow globes from a distributor for $5 and sells them for $8. All purchases are made on credit one month in advance of sales and are paid for the month following the purchase. What are the Snow Globe Emporium's payments in March? Sales and Purchase Forecast
The Snow Globe Emporium
$$\begin{array} { | l | c | c | c | c | } 
\hline & \text { January } & \text { February } & \text { March } & \text { April } \
\hline \text { Sales Forecast (units) } & 2,000 & 3,000 & 3,800 & 4,700 \
\hline \begin{array} { l } 
\text { Purchases from } \
\text { Suppliers (\$) }
\end{array} & & & & \
\hline \text { Payments to Suppliers } & & & & \
\hline & & & & \
\hline \text { Beginning Accounts } & &\$15,000 & & \
\text { Payable } \
\hline \text { Ending Accounts } &\
\text { Payable }&\$15\
\hline 
\end{array}$$

Quizplus · Accepted Answer

The payments in March are for the purchases made in February. The sales forecast for February is 3,000 units. Since each unit is purchased for $5, the cost of purchases in February is 3,000 units * $5/unit = $15,000. Additionally, the beginning accounts payable is $15,000, so the total payment in March is $15,000 + $15,000 = $30,000. However, the ending accounts payable is $15, so the actual payment made in March is $30,000 - $15 = $29,985. But since this doesn't match any option, the closest correct calculation is $15,000 for February purchases, which matches option B.

The Snow Globe Emporium Sells Snow Globes A)$15,000 B)$19,000 C)$23,500 D)$24,000 E)$30,400

The Snow Globe Emporium Sells Snow Globes A)$15,000
B)$19,000
C)$23,500
D)$24,000
E)$30,400