Delleate Inc. has prepared the following purchases budget: $$\begin{array} { | l | r | }
\hline \text { Month } & \text { Budgeted Purchases } \
\hline \text { |une } & \$ 67,000 \
\hline \text { |uly } & 72,500 \
\hline \text { August } & 76,300 \
\hline \text { September } & 73,700 \
\hline \text { October } & 69,200 \
\hline
\end{array}$$ All purchases are paid for as follows: 10% in the month of purchase, 50% in the following month, and 40% two months after purchase. Calculate balance of Accounts payable at the end of October.

Question

Delleate Inc. has prepared the following purchases budget: $$\begin{array} { | l | r | } 
\hline \text { Month } & \text { Budgeted Purchases } \
\hline \text { |une } & \$ 67,000 \
\hline \text { |uly } & 72,500 \
\hline \text { August } & 76,300 \
\hline \text { September } & 73,700 \
\hline \text { October } & 69,200 \
\hline
\end{array}$$ All purchases are paid for as follows: 10% in the month of purchase, 50% in the following month, and 40% two months after purchase. Calculate balance of Accounts payable at the end of October.

Quizplus · Accepted Answer

To calculate the Accounts Payable balance at the end of October, we need to figure out how much of the purchases made in each month are still unpaid.

For June purchases: 
- 10% paid in June = $6,700 
- 50% paid in July = $33,500 
- 40% paid in August = $26,800 
- Balance unpaid = $0

For July purchases: 
- 10% paid in July = $7,250 
- 50% paid in August = $36,250 
- 40% paid in September = $29,000 
- Balance unpaid = $0

For August purchases: 
- 10% paid in August = $7,630 
- 50% paid in September = $38,150 
- 40% paid in October = $30,520 
- Balance unpaid = $0

For September purchases: 
- 10% paid in September = $7,370 
- 50% paid in October = $36,850 
- Balance unpaid = $29,480

For October purchases: 
- 10% paid in October = $6,920 
- Balance unpaid = $62,280

So, the total balance of Accounts Payable at the end of October is the sum of the unpaid balances for September and October purchases, which is $29,480 + $62,280 = $91,760.

Therefore, the best choice is B) $91,760.

Delleate Inc All Purchases Are Paid for as Follows: 10% in the |