Thornton Company sells lamps and other lighting fixtures. The purchasing department manager prepared the following inventory purchases budget. Thorntons policy is to maintain an ending inventory balance equal to 15 percent of the following months cost of goods sold. Aprils budgeted cost of goods sold is $84,000

Required

1. Complete the inventory purchases budget by filling in the missing amounts.

2. Determine the amount of cost of goods sold the company will report on its first quarter pro forma income statement.

3. Determine the amount of ending inventory the company will report on its pro forma balance sheet at the end of the first quarter.

A.

Inventory Purchases Budget
	January	February	March
Budgeted cost of goods sold	$56,000	$60,000	$66,000
Plus: Desired ending inventory	9,000
Inventory needed	65,000
Less: Beginning inventory	8,400
Required purchases (on account)	$56,600

Determine the amount of cost of goods sold the company will report on its first quarter pro forma income statement. Determine the amount of ending inventory the company will report on its pro forma balance sheet at the end of the first quarter.

b.	Cost of goods sold:
c.	Ending inventory: