DM Electronics has projected sales of $900, $980, $1,040, and $1,200 for quarter
ID: 2769789 • Letter: D
Question
DM Electronics has projected sales of $900, $980, $1,040, and $1,200 for quarters 1 to 4, respectively. Sales in the following year are projected to be 12 percent greater in each quarter. Assume the firm places orders during each quarter equal to 40 percent of projected sales for the next quarter. How much will the firm pay to its suppliers in quarter 2 if its accounts payable period is 60 days?
DM Electronics has projected sales of $900, $980, $1,040, and $1,200 for quarters 1 to 4, respectively. Sales in the following year are projected to be 12 percent greater in each quarter. Assume the firm places orders during each quarter equal to 40 percent of projected sales for the next quarter. How much will the firm pay to its suppliers in quarter 2 if its accounts payable period is 60 days?
Explanation / Answer
Q2 payment = 2/3 * (0.4 * 980) + 1/3 * (0.4 * 1040)
261.33 + 138.67 = 400
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