Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Dynamic Futon forecasts the following purchases from suppliers: Jan. Mar. Feb. 29 Apr. 23 May 21 Jun. 21 Value of goods ($ millions) 33 26

image text in transcribed

Dynamic Futon forecasts the following purchases from suppliers: Jan. Mar. Feb. 29 Apr. 23 May 21 Jun. 21 Value of goods ($ millions) 33 26 a. Fifty percent of goods are supplied cash-on-delivery. The remainder are paid with an average delay of 1 month. If Dynamic Futon starts the year with payables of $23 million, what is the forecasted level of payables for each month? (Do not round intermediate calculations. Enter your answers in millions of dollars rounded to 1 decimal place.) Jan. Feb. Jun. Mar. 27.5 $ Apr. 24.5 May 22.0 Payables $ 39.5 $ 31.0 $ $ $ 21.0 b. Suppose that, from the start of the year, the company stretches payables by paying 30% after 1 month and 10% after 2 months. (The remainder continue to be paid cash-on-delivery.) Recalculate payables for each month assuming that there are no cash penalties for late payment. Assume that Dynamic Futon didn't have any payable balance at the start of the year. (Do not round intermediate calculations. Enter your answers in millions of dollars rounded to 1 decimal place.) Jan. Feb. Mar. Apr. Jun. May 22.1 Payables $ 19.8 $ 27.3 $ 27.6 $ 24.5 $ $ 21.2

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Personal Finance

Authors: Jack Kapoor, Les Dlabay, Robert J Hughes

9th Edition

0073382329, 9780073382326

More Books

Students also viewed these Finance questions