Answer:
$43.0 million
Explanation:
The movement in the balance of inventory at the start and end of a period is as a result of sales and purchases. While sales reduces the balance in inventory, purchases increases the balance. This may be expressed mathematically as
Opening balance + purchases - cost of goods sold = closing balance
The difference between the closing balance and the opening is$5 million
Hence the
Purchases - $45,000,000 = $5,000,000
Purchases = $5,000,000 + $45,000,000
= $50,000,000
The movement in the payable accounts may be expressed as
opening balance + purchases - cash paid = closing balance
$50,000,000 - cash paid = $7,000,000
Cash paid = $50,000,000 - $7,000,000
= $43,000,000
