Bristol Ltd settles their creditors' accounts as follows: 25% in the month of purchase and 75% in the month following purchase.For the month of August their credit purchases totalled $32 000 and in September were $43 000.How much cash did Bristol Ltd pay to their creditors in the month of September?

Question

Quizplus · Accepted Answer

In September, Bristol Ltd would pay 75% of August's purchases and 25% of September's purchases. For August ($32,000), 75% is $24,000. For September ($43,000), 25% is $10,750. Adding these together gives $24,000 + $10,750 = $34,750.

Bristol Ltd Settles Their Creditors' Accounts as Follows: 25% in the Month