Exercise 14.7 Preparing an Inventory purchases budget LO 14-3 Walton Company sells lamps and other lighting fixtures. The purchasing department manager prepared the following inventory purchases budget. Walton'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 $78,000. 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. Determine the timount of ending inventory the company will report on its pro forma balance sheet at the end of the first quarter. Complete this question by entering your answers in the tabs below. ReqA Req B and C Complete the inventory purchases budget by filling in the missing Inventory Purchases Budget January February March Complete this question by entering your answers in the tabs below. Req A Reg B and C Complete the inventory purchases budget by filling in the missing amounts. March $ 70,000 Inventory Purchases Budget January February Budgeted cost of goods sold $ 60,000 $ 64,000 Plus: Desired ending inventory 6,400 Inventory needed 66,400 Less Beginning inventory 6,000 Required purchases (on account) $ 60,400 Reg B and C > Complete this question by entering your answers in the tabs below. Req A Req B and C Determine the amount of cost of goods sold the company will report on its first quarter pro forma income statement. Determine the amount of ending inventory the company will report on its pro forma balance sheet at the end of the first quarter. b. Cost of goods sold c. Ending inventory The budget director for Adams Cleaning Services prepared the following list of expected selling and administrative expenses. All expenses requiring cash payments are paid for in the month incurred except salary expense and insurance. Salary is paid in the month following the month in which it is incurred. The insurance premium for six months is paid on October 1. October is the first month of operations, accordingly, there are no beginning account balances. Required a. Complete the schedule of cash payments for S&A expenses by filling in the missing amounts b. Determine the amount of salaries payable the company will report on its pro forma balance sheet at the end of the fourth quarter c. Determine the amount of prepaid insurance the company will report on its pro forma balance sheet at the end of the fourth quarter. Complete this question by entering your answers in the tabs below. ReqA Red Band C Complete the schedule of cash payments for SBA expenses by filling in the missing amounts. October November December Budgeted S&A Expenses Equipment lease expense Salary expense $ 6,400 $ 6.400 $ 5.400 7.000 Complete the schedule of cash payments for S&A expenses by filling in the missing amounts. October November December $ $ $ 6,400 7,000 2,890 1,700 1,800 2,300 790 22,880 6,400 7,500 2,750 1,700 1,800 2,300 Budgeted S&A Expenses Equipment lease expense Salary expense Cleaning supplies Insurance expense Depreciation on computer Rent Miscellaneous expenses Total operating expenses Schedule of Cash Payments for S&A Expenses Equipment lease expense Prior month's salary expense, 100% Cleaning supplies Insurance premium Depreciation on computer Rent Miscellaneous expenses Total disbursements for operating expenses 6,400 7,900 3,090 1,700 1,800 2,300 790 23,980 790 $ $ 23,240 $ $ 22,580 $ 19,240 $ 20,080 a. Complete the schedule of cash payments for S&A expenses by filling in the missing amounts. b. Determine the amount of salaries payable the company will report on its pro forma balance sheet at the end of the fourth quarter. c. Determine the amount of prepaid insurance the company will report on its pro forma balance sheet at the end of the fourth quarter. Complete this question by entering your answers in the tabs below. ReqA Req B and C Determine the amount of salaries payable and prepaid insurance the company will report on its pro forma balance sheet at the end of the fourth quarter. b. Salaries payable c. Prepaid insurance & Reg A
