Selling, general, and administrative costs totaled $20 million, all on a short-term credit basis with vendors. We paid $19 million (cash) in outstanding accounts payable during the quarter. What are the journal entries?

Selling, general, and administrative costs totaled $20 million, all on a short-term credit basis with vendors. We paid $19 million (cash) in outstanding accounts payable during the quarter. What are the journal entries?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter21: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 2P: Medwig Corporation has a DSO of 17 days. The company averages 3,500 in sales each day (all customers...

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Concept explainers

Conversion Cycle

Conversion cycle is also known as cash cycle or net operating cycle. Conversion cycle refers to how much time a company takes to turn its investments which is done from stock or any other financial resources into cash flows from sales.

Question

Selling, general, and administrative costs totaled $20 million, all on a short-term credit basis with vendors. We paid $19 million (cash) in outstanding accounts payable during the quarter.

What are the journal entries?

Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.

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