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Dear Mr. John ,
Greetings..
In the chapter budget -17 , I have gone through your lecture but little confusion in example 3 in additional info A: why credit sale 60% has been calculated on NOV and Dec ?
B :In the question said , purchase paid in current month by why taken in the following month starting from December?
C. why the wages paid of Dec in Jan the exact amount 12000/-Need your help to clear the concept..
Regards
VictorA: Credit sales pay 2 months after the month of sale. Therefore the cash from credit sales in November is received two months later, which is January.
B: The question does not say that purchases are paid in the current month. It says that purchases are paid in the month following purchase. So purchases in December are paid for in January.
C: 75% of wages are paid in the current month, and 25% in the following month. So 25% of Decembers wages are paid in January, and 75% of Januarys wages are paid in January.
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