d245 PE 66BCash budget te Candle Co pays 20 of its purchases

d245 PE 6-6BCash budget te Candle Co. pays 20% of its purchases on account in the month of the pur- chase and 80% in the month following the purchase. If purchases are budgeted to be $18,000 for October and $19,500 for November, what are the budgeted cash payments for purchases on account for November?

Solution

Budgeted cash payments for purchases on account for November

=(October*80%)+(November*20%)

which is equal to

=($18000*80%)+($19500*20%)

=$18300.