The financial statements of Juliet Company show the following: $$\begin{array} { | l | r | r | }
\hline & \text { Beginning balance } & \text { Ending balance } \
\hline \text { Trade receivables } & \$ 28,000 & \$ 22,000 \
\hline \text { Trade payables } & \$ 11,000 & \$ 15,000 \
\hline \text { Purchases } & & \$ 74,000 \
\hline
\end{array}$$ How much cash was paid out to suppliers?
A) $11,000.
B) $15,000.
C) $70,000.
D) $74,000.

Question

The financial statements of Juliet Company show the following: $$\begin{array} { | l | r | r | } 
\hline & \text { Beginning balance } & \text { Ending balance } \
\hline \text { Trade receivables } & \$ 28,000 & \$ 22,000 \
\hline \text { Trade payables } & \$ 11,000 & \$ 15,000 \
\hline \text { Purchases } & & \$ 74,000 \
\hline
\end{array}$$ How much cash was paid out to suppliers?
A) $11,000.
B) $15,000.
C) $70,000.
D) $74,000.

Quizplus · Accepted Answer

To calculate the cash paid out to suppliers, we start with the purchases amount and adjust it for the change in trade payables. The purchases were $74,000. Trade payables increased from $11,000 to $15,000, indicating that $4,000 of the purchases were not paid for by the end of the period. Therefore, the cash paid out to suppliers is $74,000 (purchases) - $4,000 (increase in trade payables) = $70,000.

The Financial Statements of Juliet Company Show the Following How Much Cash Was Paid Out to Suppliers? A) $11,000

The Financial Statements of Juliet Company Show the Following How Much Cash Was Paid Out to Suppliers?
A) $11,000