Jackson cash payments


Jackson Company's payment policy is to pay 40 percent of its accounts payable in the quarter purchases are made and 60 percent in the following quarter. Assume Jackson's credit purchases totaled $400,000 in quarter 1, $420,000 in quarter 2, $530,000 in quarter 3 and $580,000 in quarter 4. What will Jackson's cash payments be for quarter 3?

A. $482,500

B. $560,000

C. $530,000

D. $464,000

E. None of the above.

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Accounting Basics: Jackson cash payments
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