During March, Led Company's budgeted accounts payable increased $10,000, budgeted inventory decreased $15,000 and budgeted cost of goods sold was $95,000. How much were Led's budgeted cash payments to suppliers for the month of March?

Question

Quizplus · Accepted Answer

The increase in accounts payable is a source of cash, while the decrease in inventory is a use of cash. The budgeted cash payments to suppliers is the budgeted cost of goods sold minus the increase in accounts payable plus the decrease in inventory. Therefore, the budgeted cash payments to suppliers for the month of March is $95,000 - $10,000 + $15,000 = $100,000.

During March, Led Company's Budgeted Accounts Payable Increased $10,000, Budgeted