Reference no: EM131539273

Question: Power dyne Company's cost of goods sold is consistently 60% of sales. The company plans to carry ending merchandise inventory for each month equal to 40% of the next month's budgeted cost of good sold. All merchandise is purchased on credit, and 50% of the purchases made during a month is paid for in that month. Another 35% is paid for during the first month after purchase, and the remaining 15% is paid for during the second month after purchase. Expected unit sales are: August (actual), 150,000; September (actual), 350,000; October (estimated), 200,000; November (estimated), 300,000. Use this information to determine October's expected cash payments for purchases.