Iron Man Products has projected the following sales for the coming year:

Q1 Q2 Q3 Q4
Sales $ 700 $ 850 $ 950 $ 1,050

Calculate payments to suppliers assuming that Iron Man places orders during each quarter equal to 33 percent of projected sales for the next quarter. Assume that Iron Man pays immediately. The payables period in this case is 0 days.

Q1 Q2 Q3 Q4
Payment of accounts$280 $313 $346 $?

What is the formula to find the answer for quarter 4? My book and sample problem is unclear on it.

To calculate the payment for quarter 4, you need to understand the calculation process.

Iron Man places orders during each quarter equal to 33% of projected sales for the next quarter. This means that the payment for each quarter is equal to 33% of the projected sales.

Considering the payables period is 0 days, Iron Man pays immediately. Therefore, the payment for each quarter is made in the same quarter as the sales.

To find the payment for quarter 4, you would multiply the projected sales for quarter 4 by 33%. The formula to calculate the payment for any quarter would be:

Payment = Projected Sales * 33%

In this case, to find the payment for quarter 4, you would use the formula:

Payment for Q4 = $1,050 * 33%

To calculate the answer, multiply $1,050 by 0.33:

Payment for Q4 = $1,050 * 0.33

The payment for quarter 4 would be equal to $346.50.