Golden Company had a balance of $40,000 in Accounts Payable at the beginning of June, and purchased $30,000 of merchandise on account during the month At the end of June, Golden's Account Payable balance was $28,000. What amount did Golden pay on account during June?
A) $38,000
B) $42,000
C) $108,000
D) The amount cannot be determined from the information given.

Question

Quizplus · Accepted Answer

To find out how much Golden Company paid on account during June, we need to calculate the total amount of payments they made.

Starting Accounts Payable balance: $40,000 
Purchases on account: $30,000

Total Accounts Payable in June:

$40,000 (starting balance) + $30,000 (purchases) = $70,000

To figure out how much Golden Company paid on account, we need to find the difference between the total Accounts Payable in June and the ending balance:

$70,000 - $28,000 = $42,000

Therefore, Golden Company paid $42,000 on account during June. The answer is B.

Golden Company Had a Balance of $40,000 in Accounts Payable