The payment schedule of purchases made on account is: 60% during the month of purchase, 30% in the following month, and 10% in the subsequent month

Finance Dec 09, 2020

The payment schedule of purchases made on account is: 60% during the month of purchase, 30% in the following month, and 10% in the subsequent month. Total credit purchase were Php 200,000 in May and Php 100,000 in June. Total payments on credit purchase were Php 140,000 in June. What were the credit purchase in the month of April?

Expert Solution

Answer : Calculation of Credit Purchase in the month of April :

Payment of June= 100000 * 60% = 60000

Payment of May made in June = 200000 * 30% = 60000

Payment of april made in June = 140000 - 60000 - 60000 = 20000

Payment of April made in June = 10%

Therefore Total Credit Purchase in April = 20000 / 10% = 200,000

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