Finance and Accounting

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momjidi

Mar 8, 2007, 12:59 PM

Forecasting payments. If a firm pays its bills with a 30 day delay, what fraction of its purchases
will be paid for in the current quarter? In the following quarter? What if its payment delay is 60days?

CaptainForest

Mar 8, 2007, 04:19 PM

if you have 30 days to pay...

Jan - pay Feb, etc.

This quarter 2/3
Next quarter 1/3

If at 60days?
This quarter 1/3
Next quarter 2/3

grr82bntx

Aug 25, 2007, 09:20 PM

Captain,

Why would it not be 1/3 for the first quarter and 2/3 for the second?

And 1/3 for the 60 day deferral?

I am trying to break this down Barney-style so I can understand it. With 12 months, and 4 quarters....with a 30-day delay in payments would come out to just skipping a month and two for the 60-day....How far off am I??