Scannell Readers sells eReaders. Its sales budget for the nine months ended September 30 follows:

In the past, cost of goods sold has been 60% of total sales. The director of marketing and the financial vice president agree that each quarter€™s ending inventory should not be below $ 10,000 plus 10% of cost of goods sold for the following quarter. The marketing director ­expects sales of $ 230,000 during the fourth quarter. The January 1 inventory was $ 18,000.

Requirement
Prepare a cost of goods sold, inventory, and purchases budget for each of the first three quarters of the year. Compute cost of goods sold for the entire nine- monthperiod.

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Scannell Readers Sales Budget For the Nine Months Ended September 30 Quarter Ended Nine-Month Cash sales, 40% Credit sales, 60% Total sales, 100% Mar 31 Jun 30 Sp 30 Total $ 52,000 7200 62, $186,000 78,000 $130,000 $180,000 $155,000 $465,000 108,000 93,000 279,000