Ospika Products has projected the following sales for the coming year: Sales in
ID: 2707130 • Letter: O
Question
Ospika Products has projected the following sales for the coming year:
Sales in the year following this one are projected to be 10 percent greater in each quarter.
a. Calculate payments to suppliers assuming that Ospika places orders during each quarter equal to 30 percent of projected sales for the next quarter. Assume that Ospika pays immediately.
b. Calculate payment to suppliers assuming a 90-day payables period.
c. Calculate payment to suppliers assuming a 60-day payables period.
Ospika Products has projected the following sales for the coming year:
Explanation / Answer
PARTICULARS
QUARTER 1
QUARTER 2
QUARTER 3
QUARTER 4
SALES
960
1040
1000
1100
SALES IN THE FOLLOWING YEAR
960*1.1 = 1056
1040*1.1=1144
1000*1.1=1100
1100*1.1=1210
PURCHASES IN EACH QUARTER
30%*1040=312
30%*1000=300
30%*1100=330
30%*1056=316.8
Ospika pays immediately.
312
300
330
316.8
assuming a 90-day payables period.
960*30%=288
312
300
330
assuming a 60-day payables period.
312
300
330
316.8
PARTICULARS
QUARTER 1
QUARTER 2
QUARTER 3
QUARTER 4
SALES
960
1040
1000
1100
SALES IN THE FOLLOWING YEAR
960*1.1 = 1056
1040*1.1=1144
1000*1.1=1100
1100*1.1=1210
PURCHASES IN EACH QUARTER
30%*1040=312
30%*1000=300
30%*1100=330
30%*1056=316.8
Ospika pays immediately.
312
300
330
316.8
assuming a 90-day payables period.
960*30%=288
312
300
330
assuming a 60-day payables period.
312
300
330
316.8
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