Question:
The Peking Duck Corporation's purchases from suppliers in a quarter are equal to 60 percent of the next quarter's forecast sales. The payables deferral period is 60 days. Wages, taxes, and other expenses are 25 percent of sales, while interest and dividends are $10 per quarter. No capital expenditures are planned.
Projected quarterly sales are
Q1 = $600
Q2 = $400
Q3 = $560
Q4 = $800
Sales in the first quarter of the following year are projected at $760. Calculate Peking Duck's cash outlays by completing the following:
Q1 Q2 Q3 Q4
Payments of accounts
Wages, taxes, other expenses
Long-term financing expenses
(interest and dividends)