Question

Heritage, Inc., had a cost of goods sold of $68,314. At the end of the year, the accounts payable balance was $15,486. How long on average did it take the company to pay off its suppliers during the year? (Use 365 days a year. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Answer 1

Answer:

Account payable days = 82.74 days

Explanation:

The payable days is the  average length of time it takes for a business to settle its account payable.

it is calculated as follows:

Account payable days = average account payable/ cost of goods sold×  365 days

= 15,486/68314× 365 days= 82.7413

It will take Heritage about 82.74 days to settle its account payable.

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