Show Place Decor has estimated quarterly sales for next year, starting with Quarter 1, of $38,600, $53,400, $48,900, and $69,800.Purchases are equal to 62 percent of the following quarter's sales and the accounts payable period is 30 days.Assume each month has 30 days.What is the estimated accounts payable balance at the end of Quarter 2?

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Quizplus · Accepted Answer

At the end of Quarter 2, the accounts payable balance is based on 62% of Quarter 3's sales. Quarter 3 sales are $48,900, so purchases are 0.62 * $48,900 = $30,318. Since the accounts payable period is 30 days, the balance at the end of Quarter 2 is $30,318 / 3 = $10,106.

Show Place Decor Has Estimated Quarterly Sales for Next Year