Swenson, Inc., sells tire rims. Its sales budget and inventory, purchases, and cost of goods sold budget for the nine months ended September 30, 2016, follow:

Selling and Administrative Expense Budget Nine Months Ended September 30, 2016 Quarter Quarter Quarter Ended Ended Ended Nine-month March 31 June 30 September 30 Total Variable expenses: Total variable expenses Fixed expenses: Total fixed expenses Total selling and administrative expenses Nine Months Ended September 30, 2016 Quarter Ended Nine-Month March 31 June 30 September 30 Total Cash sales, 20% $ 24,000 96,000 34,000 $ 136,000 170,000 $ Credit sales, 80% 29,000 $ 116,000 145,000 $ 87,000 348,000 $ 120,000 $ 435,000 Total sales Swenson, Inc. Inventory, Purchases, and Cost of Goods Sold Budget Nine Months Ended September 30, 2016 Quarter Ended Quarter Ended Quarter Ended |Nine-Month March 31 June 30 September 30 Total Cost of goods sold 48,000 $ 68,000 58,000 174,000 Plus: Desired ending merchandise inventory 31,800 30,800 33,800 Total merchandise inventory required 79,800 $ 98,800 $ 91,800 Less: Beginning merchandise inventory 16,000 31,800 30,800 Budgeted purchases 63,800 67,000 61,000 Rent, $2,500 per month Salaries, $3,000 per month Commissions, 3% of sales Depreciation, $1,300 per month Miscellaneous expenses, 2% of sales