The cost of merchandise sold during the year was $45,000. Merchandise inventories were $13,500 and $10,500 at the beginning and

Question

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The cost of merchandise sold during the year was $45,000. Merchandise inventories were $13,500 and $10,500 at the beginning and

end of the year, respectively. Accounts payable were $7,000 and $5,000 at the beginning and end of the year, respectively. Using the direct method of reporting cash flows from operating activities, cash payments for merchandise total

Business

1 answer:

GenaCL600 [577] · Answer 1 · 2022-01-23T06:44:08+03:00

Answer:

cash payments for merchandise total is $44,000

Explanation:

purchase for the year

Beginning Investment + Purchases - Ending Investment = Cost of Merchandise sold

13,500 + Purchases - 10,500 = 45,000

Purchases = 42,000

Therefore, the total cash paid for merchandise

Beg. A/P + Purchases - End. A/P = Cash Paid

7,000 + 42,000 - 5,000 = $44,000