1. Monument Corp. is preparing its budget for the first quarter of 2018. The following data is provided:

April's cost of goods sold is 32,000. The amount of Merchandise Inventory to be shown on the budgeted balance sheet at March 31 would be ________.

2. The fixed overhead volume variance is a cost variance that explains why fixed overhead is over-allocated or under-allocated.

a. True

b. False

Inventory, Purchases, and COGS Budget Cost of goods sold (a) Desired ending inventory (b) Total inventory required Less: Beginning inventory Purchases (a) COGS = 75% of sales (b) $5,000 + 25% of COGS for next month Jan Feb March $34,000 $27,000 $22,500 11,750 10,625 45,750 37,625 (20,000) (11,750) 25,750 25,875