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October November December Budgeted Sales $460,000 $440,000 $540,000 Budgeted Purchases $240,000 $256,000 $228,000 Cost of goods sold is 35% of sales Alli's Broom's purchases and pays for merchandise 60% in the month of acquisition and 40% in the following month Accounts payable is used only for inventory acquisitions How much is the budgeted balance for Accounts Payable at October 31, 2019? No decimal points.

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Answer:

Month incurred  Amount  October   November    December

                               $               $               $                    $

October              240,000   144,000   96,000

November          256,000                    153,600       102,400

December           228,000                                         136,800

                                               144,000    249,600      239,200

The budgeted balance for accounts payable at October 31 is $96,000, which is the 40% of purchases not realized in October.

Explanation:

Purchases for each month are settled 60% in the month of purchases and 40% in the month following purchases. 60% of October purchases are settled in October while 40% are settled in November.

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