Goldman Corp.reported the following information for 2016 and 2017. ? $\begin{array}{lr}
\text { Accounts payable, December 31,2016 } & \$ 51,000 \
\text { Accounts payable, December } 31,2017 & 46,000 \
\text { Purchases-2017 } & 467,000
\end{array}$ How much cash was paid for merchandise purchases during 2017?
A) $421,000
B) $462,000
C) $467,000
D) $472,000

Question

Quizplus · Accepted Answer

To calculate cash paid for merchandise purchases during 2017, use the formula: Cash Paid = Purchases + Decrease in Accounts Payable or - Increase in Accounts Payable. Here, Purchases = $467,000, Accounts Payable decreased from $51,000 to $46,000, a decrease of $5,000. So, Cash Paid = $467,000 - $5,000 = $472,000.

Goldman Corp How Much Cash Was Paid for Merchandise Purchases During 2017