Question
Narai Co. has a desired ending inventory of 30% of the next months forecasted sales. In turn, their cost of goods sold is 60%, and
Narai Co. has a desired ending inventory of 30% of the next months forecasted sales. In turn, their cost of goods sold is 60%, and their forecasted sales for the months of March, April, May, June, and July are as follows: $750,000, $880,000, $700,000, $800,000, and $900,000 respectively.
Purchases for the months of February and March were $500,000 and $360,000 and their purchases are paid as follows: 10% during the month of the purchase 80% in the next month and the final 10% in the next month.
Required:
Prepare budget schedules for the months of April, May, and June for required purchases and also for disbursements for purchases.
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