Magnolia Candle Co. pays 10% of its purchases on account in the month of the purchase and 90% in the month

Magnolia Candle Co. pays 10% of its purchases on account in the month of the purchase and 90% in the month following the purchase. If purchases are budgeted to be $11,900 for March and $12,700 for April, what are the budgeted cash payments for purchases on account for April?

Answer:
                                                                                                                                          April
Payments for March purchases (90% × $11,900)…………………………………… $10,710
Payments for April purchases (10% × $12,700)…………………………………………1,270
Total payments for purchases on account………………………………………………  $11,980