Question

Broihan Corporation has the following purchases budget for the last half of 2002:

Answer 1

Answer:

b. $ 90,000.

Explanation:

Since the company pays half of the purchased amount at the time of purchase and the remainder in the following month. Cash disbursements in August are expected to be half of the amount purchased in July plus half of the amount purchased in August. Expected cash disbursements are:

$E=\frac{100,000}{2}+ \frac{80,000}{2}\\ E=\ 90,000$

The answer is alternative b. $ 90,000.