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Horngren’s Cost Accounting

Srikant M. Datar, Madhav V. Rajan 16th Edition

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Solved by Expert Akash M

07/20/2023

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Transcript

00:01 We have to calculate the forecasted amount of total cash payment for purchases in november of year one.

00:08 So here we'll write september, october and november.

00:30 So sales is one lakh, october is one lakh fifty thousand and in november is three lakh.

00:57 Then cost of goods sold that is sixty percent of sales.

01:23 So sixty thousand, ninety thousand and one lakh eighty thousand.

01:34 Then inventory purchases are equal to two cogs.

02:07 Sixty thousand, ninety thousand and one lakh eighty thousand.

02:17 Then of the purchases ten percent are cash purchases that is a.

02:35 So six thousand, ninety thousand and one lakh eighty thousand.

02:45 Then of the purchases ten percent are, sorry, ninety percent are credit purchases.

03:13 So fifty four thousand, eighty one thousand and one lakh sixty two thousand.

03:23 So sixty thousand multiplied by ninety percent, then ninety thousand multiplied by ninety percent and eighteen thousand multiplied by ninety percent.

03:50 So here five percent are paid in the same month...

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