Expected purchases for June and July are $76,000 and $90,000, respectively. Purchases for May were $56,000. All purchases are paid 40% in the month of purchase and 60% the following month. At what amount are June payments for purchases budgeted?

Question

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June payments include 40% of June purchases ($76,000 * 0.40 = $30,400) and 60% of May purchases ($56,000 * 0.60 = $33,600), totaling $64,000.

Expected Purchases for June and July Are $76,000 and $90,000