Fanning Books buys books and magazines directly from publishers and distributes them to grocery stores. The wholesaler expects to purchase the following inventory: April May June Required purchases (on account) $ 116,000 $ 136,000 $ 148,000 Fanning Books’ accountant prepared the following schedule of cash payments for inventory purchases. Fanning Books’ suppliers require that 95 percent of purchases on account be paid in the month of purchase; the remaining 5 percent are paid in the month following the month of purchase. Required Complete the schedule of cash payments for inventory purchases by filling in the missing amounts. Determine the amount of accounts payable the company will report on its pro forma balance sheet at the end of the second quarter.
Fanning Books buys books and magazines directly from publishers and distributes them to grocery stores. The wholesaler expects to purchase the following inventory: April May June Required purchases (on account) $ 116,000 $ 136,000 $ 148,000 Fanning Books’ accountant prepared the following schedule of cash payments for inventory purchases. Fanning Books’ suppliers require that 95 percent of purchases on account be paid in the month of purchase; the remaining 5 percent are paid in the month following the month of purchase. Required Complete the schedule of cash payments for inventory purchases by filling in the missing amounts. Determine the amount of accounts payable the company will report on its pro forma balance sheet at the end of the second quarter.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Fanning Books buys books and magazines directly from publishers and distributes them to grocery stores. The wholesaler expects to purchase the following inventory:
| April | May | June | |||||||
| Required purchases (on account) | $ | 116,000 | $ | 136,000 | $ | 148,000 | |||
Fanning Books’ accountant prepared the following schedule of cash payments for inventory purchases. Fanning Books’ suppliers require that 95 percent of purchases on account be paid in the month of purchase; the remaining 5 percent are paid in the month following the month of purchase.
Required
Complete the schedule of cash payments for inventory purchases by filling in the missing amounts.
Determine the amount of accounts payable the company will report on its pro forma
Transcribed Image Text:Required A Required B
Complete the schedule of cash payments for inventory purchases by filling in the missing an
Schedule of Cash Payments for Inventory Purchases
April
May
Payment for current accounts payable
Payment for previous accounts payable
Total budgeted payments for inventory
$ 110,200
10,000
$ 120,200
< Required A
June
Required B >
Transcribed Image Text:Required A Required B
Determine the amount of accounts payable the company will report on its pro forma balance sheet at the end of the second
quarter.
Accounts payable
< Required A
Required B >
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