Fort Dodge Corporation Has the Following Information Purchases Are Paid for in the Following Manner: 40% in }

question 135

Multiple Choice

Fort Dodge Corporation has the following information: $\begin{array}{lr}\text { Month } & \text { Budgeted Purchases } \\\hline \text { August } & \$ 35,000 \\\text { September } & 38,000 \\\text { October } & 47,000 \\\text { November } & 36,500 \\\text { December } & 46,000\end{array}$ Purchases are paid for in the following manner: 40% in the month of purchase
50% in the month after purchase
10% two months after purchase
_____ is the estimated cash disbursement in December from October purchases.

• A)$21,750
• B)$17,400
• C)$4,700
• D)$18,400

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Definitions:

Initial Price

The original cost or price of a good or service when it is first offered for sale, often used as a baseline for pricing strategies.

Contribution Margin

The amount remaining from sales revenue after variable costs have been deducted, used to cover fixed costs and contribute to profit.

Machine Hour

A unit of measure representing the operation of a machine for one hour, often used in cost accounting.

Floor Deodoriser

A cleaning agent specifically designed to eliminate odors and freshen floors in residential or commercial spaces.