Sentra Sporting Company sells tennis rackets and other sporting equipment. The purchasing department manager prepared the inventory purchases budget. Sentra's policy is to maintain an ending inventory balance equal to 15% of the following month's cost of goods sold. January's budgeted cost of goods sold is $70,000.

OctoberNovemberDecember Budgeted Cost of Goods Sold 60,00040,00050,000 Plus: Desired Ending Inventory 6,000?Inventory Needed 66,000? Less: Beginning Inventory9,000? Required purchases (on Account)57,000?

What is the amount of ending inventory that the company will report on its pro forma balance sheet?

Multiple Choice

• $7,500
• $10,500
• $35,300
• $60,500