Smith, Inc. sells tire rims. Its sales budget for the nine months ended September $30,2025,$ and additional information follow:

View the budget.

View the additional information.

Prepare an inventory, purchases, and cost of goods sold budget for each of the first three quarters of the year. Compute cost of goods sold for the entire nine$-$month period.

Budgeted Purchases

Less: Beginning merchandise inventory

Additional Information

Total merchandise inventory required

In the past, cost of goods sold has been $40\%$ of total sales. The director of

marketing and the financial vice president agree that each quarter's ending

inventory should not be below $$8,000$ plus $10\%$ of cost of goods sold for the

following quarter. The marketing director expects sales of $$235,000$ during the

fourth quarter. The January $1$ inventory was $$15,000.$