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How do you compute the desired beginning inventory and the budgeted purchases? Norton Company prepared the following sales budget: Month Budgeted Sales March $200,000 April
How do you compute the desired beginning inventory and the budgeted purchases?
Norton Company prepared the following sales budget:
Month | Budgeted Sales |
March | $200,000 |
April | $180,000 |
May | $220,000 |
June | $260,000 |
Cost of goods sold is budgeted at 60% of sales, and the inventory at the end of February was $36,000. Desired inventory levels at the end of each month are 30% of
the next month's cost of goods sold.
- What is the desired beginning inventory on June 1?
A) $36,000 B) $39,600 C) $43,200 D) $46,800
- How much are the budgeted purchases for the month of April?
A) $157,200 B) $123,900 C) $134,400 D) $99,700
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