The financial statements for World Company show the following:
Cost of goods sold,$725,000. $\begin{array}{lrlrl}
&\text { Beginning Balance } & \text { Ending Balance } \
\text { Merchandise Inventory } & \$ 45,000 & \$ 56,000 \
\text { Accounts Receivable } & 53,000 & 50,000 \
\text { Accounts Payable } & 37,000 & 42,000
\end{array}$ How much cash was paid to suppliers?
A)$731,000
B)$736,000
C)$719,000
D)$714,000

Question

The financial statements for World Company show the following:
Cost of goods sold,$725,000. $\begin{array}{lrlrl}
&\text { Beginning Balance } & \text { Ending Balance }  \
\text { Merchandise Inventory } & \$ 45,000 & \$ 56,000 \
\text { Accounts Receivable } & 53,000 & 50,000 \
\text { Accounts Payable } & 37,000 & 42,000
\end{array}$ How much cash was paid to suppliers?
A)$731,000
B)$736,000
C)$719,000
D)$714,000

Quizplus · Accepted Answer

Cash paid to suppliers = Cost of goods sold + Increase in accounts payable - Decrease in merchandise inventory= $725,000 + ($42,000 - $37,000) - ($56,000 - $45,000)= $725,000 + $5,000 - $11,000= $731,000

The Financial Statements for World Company Show the Following: Cost

The Financial Statements for World Company Show the Following:
Cost