Assume cash paid to suppliers for 2014 is $420,000,that merchandise inventory increased by $20,000 during the year,and that cost of goods sold was $415,000 for the year.During 2014,accounts payable must have
A) increased by $5,000.
B) decreased by $5,000.
C) increased by $15,000.
D) decreased by $15,000.

Question

Quizplus · Accepted Answer

To determine the change in accounts payable, we can use the formula: Cash Paid to Suppliers = Cost of Goods Sold + Increase in Inventory - Increase in Accounts Payable. Plugging in the given values: $420,000 = $415,000 + $20,000 - Increase in Accounts Payable. Solving for the increase in accounts payable gives us $15,000.

Assume Cash Paid to Suppliers for 2014 Is $420,000,that Merchandise