Question - The July 31st 1997 balance sheet of sun Corp follows
Cash 8000
Accounts receivable (net of allowances for uncollectible accounts of $2,000) 38000
Inventory 16000
Property plant and equipment (net of allowances for accumulated depreciation of $60000) 40000 $102,000
Accounts payable $ 82500
Common stuck 50000
Retained earnings (deficit) (30,500) $102,000
Sales are budgeted as follows August $110,000
September $120,000
Collections are expected to be 60% in the month of sale 38% the next month and 2% uncollectible
The gross margin is 25% of sales. Purchases each month are 75% of the next month projected sales. The purchases are paid in full the following month
Other expenses for each month paid in cash or expected to be $16,500. Depreciation each month is $5,000.
What is the projected balance in accounts payable on August 31st 1997?
A. 106500
B. 90000
C. 82500