RJB Made Inventory Purchases Amounting to $200,000 During 2014

question 100

Multiple Choice

RJB made inventory purchases amounting to $200,000 during 2014. During the year, its accounts payable (all of which arose from inventory purchases) increased by $20,000. The company had sales of $1,000,000 and is subject to a gross profit percentage of 90%. How much cash did RJB pay to its inventory suppliers during 2014?

• A) $120,000
• B) $180,000
• C) $320,000
• D) $220,000

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Definitions:

Testable Explanation

A hypothesis that can be supported or refuted through experimentation or observation.

Hypothesis

A proposed explanation for a phenomenon, subject to further testing and experimentation.

Photosynthesis

The process by which green plants, algae, and some bacteria convert light energy and carbon dioxide into chemical energy in the form of glucose, releasing oxygen as a byproduct.

Producers

Organisms, mainly plants and algae, that can produce their own food through the process of photosynthesis, serving as the base of the food chain.