entalImported From Edge Exam Saved Vernon Company sells lamps and other lighting

Question

entalImported From Edge Exam Saved Vernon Company sells lamps and other lighting fixtures. The purchasing department manager prepared the following inventory purchases budget. Vernon's policy is to maintain an ending inventory balance equal to 10 percent of the following month's cost of goods sold. April's budgeted cost of goods sold is $76,000. Required a. Complete the inventory purchases budget by filling in the missing amounts. b. Determine the amount of cost of goods sold the company will report on its first quarter pro forma income statement. c. Deter mine the amount of ending inventory the company will report on its pro forma balance sheet at the end of the first quarter. 8:21 Complete this question by entering your answers in the tabs below. Req A Req B and C Complete the inventory purchases budget by filling In the missing amounts Inventory Purchases Budget January FebruaryMarch S 52,000 S 56,000$ 62,000 Budgeted cost of goods sold Plus: Desired ending inventory Inventory needed Less: Beginning inventory Required purchases (on account)52,400 5,600 57,600 5,200 Req B and C>

Explanation / Answer

Production budget January February March Total Cost of goods sold 52,000 56,000 62,000 1,70,000 Add ending inventory 5,600 6,200 7,600 7,600 Inventory needed 57,600 62,200 69,600 1,77,600 Less beginning inventory 36,000 5,600 6,200 36,000 Purchase 21,600 56,600 63,400 1,41,600 Cost of goods sold 170000 Ending inventory 7600 (76000*10%)

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