Nathans Hot Dog Corp has projected the following sales for the coming year:

Q1 Q2 Q3 Q4
Sales $ 700 $ 850 $ 950 $ 1,050
Sales in the year following this one are projected to be 17 percent greater in each quarter.

Calculate payments to suppliers assuming that Nathans places orders during each quarter equal to 32 percent of projected sales for the next quarter. Assume that Nathans pays immediately. The payables period in this case is 0 days.

Payment of Accounts
Q1 Q2 Q3 Q4
$272 $304 $336 $262.08
This is a sample to do my HW with. I don't understand how they got 262.08 for quarter 4.

700 x 1.17 x .3

The question was wrong, it is not greater 17% in each quarter, it is greater 17% from the FIRST quarter.

To calculate the payment to suppliers for each quarter, we need to determine the projected sales for the next quarter and then multiply it by 32%.

Given that the sales for the first quarter (Q1) are $700 and the sales for the year following this one are projected to be 17% greater in each quarter, we can calculate the projected sales for each quarter as follows:

Q1: $700
Q2: $700 * 1.17 = $819
Q3: $819 * 1.17 = $957.03
Q4: $957.03 * 1.17 = $1,118.27

Now, we can calculate the payments to suppliers for each quarter by multiplying the projected sales for the next quarter by 32%:

Q1: $819 * 0.32 = $262.08
Q2: $957.03 * 0.32 = $306.25
Q3: $1,118.27 * 0.32 = $358.08
Q4: $1,118.27 * 0.32 = $358.08

So, the payment to suppliers for Q4 should be $358.08, not $262.08 as stated in the original example.