cash management exam please help!
betty
Registered Posts: 7 New contributor 🐸
I have a question from the AAT sample assessment 1(3c)which I can't understand how to calculate..Please help:)
the company pays suppliers on the basis :25% 1 month after purchase/40% after 2 months/35% after 3 months.
At the end of period 3 the balance of trade payables is forecast to be:
balance from period 1 £30135
balance from period 2 £66900
balance from period 3 £92400
Trade payables at the end of period 3 £189435
Complete the value of payables that will be paid in period 4 and 5
The answer is £88915 in period 4 and ££68180 in period 5
I don't know where to start to get this..
the company pays suppliers on the basis :25% 1 month after purchase/40% after 2 months/35% after 3 months.
At the end of period 3 the balance of trade payables is forecast to be:
balance from period 1 £30135
balance from period 2 £66900
balance from period 3 £92400
Trade payables at the end of period 3 £189435
Complete the value of payables that will be paid in period 4 and 5
The answer is £88915 in period 4 and ££68180 in period 5
I don't know where to start to get this..
0
Comments
-
Balances at the end of Period 3:
Bal from P1 means 25% was pd P2 and 40% pd in P3. £30135 is last 35% to be pd in P4
Bal from P2 means 25% was pd in P3. £66900 is 75% of P2 purchases. 40% of P2 purchases will be pd in P4 and 35% will be pd in P5 P2 purchases is £66900 *(100/75) = £89200
Bal from P3 means 25% of £92400 will be pd in P4 and 40% pd in P5
Paid in P4
(P1) £30135
(P2) £89200 x 40% = £35680
(P3) £92400 x 25% = 23100
TOTAL = £88915
Paid in P5
(P2) £89200 x 35% = £31220
(P3) £92400 x 40% = £36960
TOTAL = £68180
It's easier to understand if this information is in table form but this is the best I can explain it on here.0 -
You are a star N4T, thank you for your help!0
Categories
- All Categories
- 1.2K Books to buy and sell
- 2.3K General discussion
- 12.5K For AAT students
- 318 NEW! Qualifications 2022
- 161 General Qualifications 2022 discussion
- 11 AAT Level 2 Certificate in Accounting
- 56 AAT Level 3 Diploma in Accounting
- 87 AAT Level 4 Diploma in Professional Accounting
- 8.8K For accounting professionals
- 23 coronavirus (Covid-19)
- 272 VAT
- 92 Software
- 273 Tax
- 135 Bookkeeping
- 7.2K General accounting discussion
- 200 AAT member discussion
- 3.8K For everyone
- 38 AAT news and announcements
- 345 Feedback for AAT
- 2.8K Chat and off-topic discussion
- 582 Job postings
- 16 Who can benefit from AAT?
- 36 Where can AAT take me?
- 42 Getting started with AAT
- 26 Finding an AAT training provider
- 48 Distance learning and other ways to study AAT
- 25 Apprenticeships
- 66 AAT membership