The Cookie Shops' Purchases Are Equal to 73 Percent of the Following

question 1

Multiple Choice

The Cookie Shops' purchases are equal to 73 percent of the following month's sales.The accounts payable period for purchases is 30 days while all other expenditures are paid in the month in which they are incurred.Assume each month has 30 days.The company has compiled the following information $$\begin{array} { | l | r | r | r | } \hline & \underline { \text { May } } & \underline { \text { June } } & \underline { \text { July } } \\\hline \text { Sales } & \$ 8,400 & \$ 8,800 & \$ 9,600 \\\hline \text { Other expenses } & 1,300 & 1,400 & 1,400 \\\hline \text { Interest and taxes } & 500 & 600 & 700 \\\hline\end{array}$$ What is the total amount of the firm's disbursements for the month of June?

• A)$8,132
• B)$8,170
• C)$7,410
• D)$7,571
• E)$8,424

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Definitions:

Income

Earnings received by an individual or business in exchange for work, services, or investments, typically measured over a certain period of time.

Pareto Efficient

An allocation of resources in which it is impossible to make any one individual better off without making at least one individual worse off.

Pure Exchange Economy

An economic model assuming no production, where agents trade existing goods and services, focusing on the allocation and distribution based on preferences.

Consumption Bundles

A combination of various goods and services chosen by a consumer based on their budget and the utility derived from the items.