Risa, Inc has provided the following extracts from their budget for the first quarter of the forthcoming year
Jan Feb March
Purchases on account $264,000 $295,000 $320,000
The vendors are allowed the following terms of payment:
Month of purchase 30%
First month after the purchase 35%
Second month after the purchase 35%
Calculate the total payment on account for the month of March.
A) $168,275
B) $136,955
C) $320,000
D) $291,650
D .D)
March
For March purchases
(30% x $320,000 ) $96,000
For Feb purchases
(35% x $295,000 ) 103,250
For Jan purchases
(35% x $264,000 ) 92,400
Total payment on account $291,650
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