Costco has adopted the following policies regarding merchandise purchases and inventory. At the end of any month, the inventory should be $16,000 plus 75% of the cost of goods to be sold during the following month. The cost of merchandise sold averages 70% of sales. Purchase terms are generally net 30 days. A given months purchases are paid as follows: 25% during that month and 75% during the following month.

Purchases in May had been $160,000 and the inventory on May 31 was higher than planned at $210,000. The manager was upset because the inventory was too high. Sales are expected to be June, $310,000; July, $300,000; August, $350,000; and September, $410,000.

(1) Compute the amount by which the inventory on May 31 exceeded the companys policies.

(2) Prepare budget schedules for June, July, and August for purchases and for disbursements for purchases.