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Adi Manufacturing Corporation is estimating the following raw material purchases for the final four months of the year: September $822,000 October $1,096,000 November $842,000 December
Adi Manufacturing Corporation is estimating the following raw material purchases for the final four months of the year:
September | $822,000 |
October | $1,096,000 |
November | $842,000 |
December | $842,000 |
At Adi, 25% of raw materials purchases are normally paid for in the month of purchase. The remaining 75% is paid for in the month following the purchase. How much cash should Adi expect to pay out for raw material purchases during November?
$1,032,500
$611,500
$822,000
$210,500
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