Answer:
3) $704,000
Explanation:
The procedure will be as follow:
Based on the company's inventory we will determinate the purchases.
And then, with the account payable balance, the cash payment
<u>First, purchases amount:</u>
beginning inventory + purchase = ending inventory + COGS
200,000 + purchase = 188,000 + 720,000
<em>purchases</em> = 720,000 + 188,000 - 200,000 = 708,000
<u>Now, we solve for payment to suppliers</u>
begging AP + purchase - payment = ending
80,000 + 708,000 - payment = 84,000
payment = 80,000 + 708,000 - 84,000
payment= 704,000
