Calculate payments to suppliers

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a. Calculate payments to suppliers assuming that Maracaibo places orders during each quarter equal to 30 percent of projected sales for the next quarter. Assume that Maracaibo pays immediately. What is the payables period in this case?


Q1 Q2 Q3 Q4
Payment of accounts VEB VEB VEB VEB

b. Rework (a) assuming a 90- day payables period.


Q1 Q2 Q3 Q4
Payment of accounts VEB VEB VEB VEB

c. Rework (a) assuming a60- day payables period.


Q1 Q2 Q3 Q4
Payment of accounts VEB VEB VEB VEB

Calculating Payments Fukuoka Sake Company's purchase from suppliers in a quarter is equal to 60 percent of the next quarter's forecasted sales. The payables period is 60 days. Wages, taxes, and other expenses are 20 percent of sales, and interest and dividends is 500 yen per quarter. No capital expenditures are planned.

Projects quarterly sales are:


Q1 Q2 Q3 Q4
Sales $75,000 $90,000 $85,000 $80,000

Sales for the quarter of the following year are projected at $100,000. Calculate fukuoka's cash outlays by completing the following:


Q1 Q2 Q3 Q4
Payment of accounts



Wages, taxes and other expenses 



Long term finanicing express



(interest and dividends)



Reference no: EM13828802

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