Question 2: (10 marks) Sound Effects Audio Systems sells and installs car stereo systems. Managers need to prepare an inventory purchases budget for the first quarter of 2019. The company's sales budget for the first quarter is provided below: January February March Budgeted Sales 200,000 $ 196,000 $ 180.000 Based on past experience the company expects the cost of goods sold to equal 80% of sales. Furthermore, the ending inventory balance each month should be $8,000 plus 20% of the current period's cost of goods sold. The inventory balance on December 31, 2018 was $34,000. The company makes all purchases on account and pays 60% of accounts payable in the month of purchase and the remaining 40% in the next month. The accounts payable balance was $36,000 on December 31, 2018. Required: 1) Prepare an inventory purchases budget for January, February, and March of 2019. (8) 2) Determine the amount of ending inventory and the accounts payable balance that will appear on the March 31, 2019 pro forma balance sheet. (2) Answer: 1)