Question

Cost of goods sold was $159,400 for the period. The beginning and ending Inventory balances for the period were $18,700 and $13,700, respectively. The beginning and ending Accounts Payable balances for the period were $22,500 and $8,200, respectively. What was the amount of the cash paid to suppliers during the period

Answer 1

,Answer:

$168,700

Explanation:

The computation of the cash paid to suppliers is shown below:

But before that first we have to determine the purchase amount which is

As we know that

Cost of goods sold = Beginning inventory + purchase - ending inventory

$159,400 = $18,700 + purchase - $13,700

So, the purchase amount is $154,400

Now the cash paid to suppliers is

= Opening balance of account payable + purchase made - ending balance of account payable

= $22,500 + $154,400 - $8,200

= $168,700

We simply applied the above formulas