Paymore Products places orders for goods equal to 75% of its sales forecast in the next quarter which has been provided in the below table. Following Year First Quarter Quarter in Coming Year Second Third $360 $336 First $372 Sales forecast Fourth $384 $384 On average, one-third of sales are collected in the quarter that they are sold, and two-thirds are collected in the following quarter.
Assume that sales in the last quarter of the previous year were $336. Also, one third of the orders are paid for in the current month and then two thirds of the next quarter’s orders are paid in advance. Assuming that Paymore’s labor and administrative expenses are $65 per quarter and that interest on long-term debt is $40 per quarter, work out the net cash flow for Paymore for the coming year using the below table. (Do not round intermediate calculations.) Quarter Second || Third First Fourth Sources of cash: Collections on accounts receivable Uses of cash: Payments of accounts payable Labor and administrative expenses Interest on long-term debt Total uses of cash Net cash inflow (outflow)