Vernon, Inc. sells fireworks. The companys marketing director developed the following cost of goods sold budget for April, May, June, and July.
| | April | May | June | July |
| Budgeted cost of goods sold | $71,000 | $81,000 | $91,000 | $97,000 |
| |
Vernon had a beginning inventory balance of $4,300 on April 1 and a beginning balance in accounts payable of $15,400. The company desires to maintain an ending inventory balance equal to 15 percent of the next periods cost of goods sold. Vernon makes all purchases on account. The company pays 70 percent of accounts payable in the month of purchase and the remaining 30 percent in the month following purchase.
Required
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Prepare an inventory purchases budget for April, May, and June.
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Determine the amount of ending inventory Vernon will report on the end-of-quarter pro forma balance sheet.
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Prepare a schedule of cash payments for inventory for April, May, and June.
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Determine the balance in accounts payable Vernon will report on the end-of-quarter pro forma balance sheet.
Vernon, Inc. sells fireworks. The company's marketing director developed the following cost of goods sold budget for April, May, June, and July. Budgeted cost of goods sold April $71,000 May $81,000 June $91,000 July $97,000 Vernon had a beginning inventory balance of $4,300 on April 1 and a beginning balance in accounts payable of $15,400. The company desires to maintain an ending inventory balance equal to 15 percent of the next period's cost of goods sold. Vernon makes all purchases on account. The company pays 70 percent of accounts payable in the month of purchase and the remaining 30 percent in the month following purchase. Required a. Prepare an inventory purchases budget for April, May, and June. b. Determine the amount of ending inventory Vernon will report on the end-of-quarter pro forma balance sheet. c. Prepare a schedule of cash payments for inventory for April, May, and June. d. Determine the balance in accounts payable Vernon will report on the end-of-quarter pro forma balance sheet. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Prepare an inventory purchases budget for April, May, and June. Inventory Purchases Budget Budgeted cost of goods sold April $ 71,000 $ May 81,000 June 91,000 $ Inventory needed Required purchases (on account) Vernon, Inc. sells fireworks. The company's marketing director developed the following cost of goods sold budget for April, May, June, and July. April May June July Budgeted cost of goods sold $ 71,000 $81,000 $91,000 $97,000 Vernon had a beginning inventory balance of $4,300 on April 1 and a beginning balance in accounts payable of $15,400. The company desires to maintain an ending inventory balance equal to 15 percent of the next period's cost of goods sold. Vernon makes all purchases on account. The company pays 70 percent of accounts payable in the month of purchase and the remaining 30 percent in the month following purchase. Required a. Prepare an inventory purchases budget for April, May, and June. b. Determine the amount of ending inventory Vernon will report on the end-of-quarter pro forma balance sheet. c. Prepare a schedule of cash payments for inventory for April, May, and June. d. Determine the balance in accounts payable Vernon will report on the end-of-quarter pro forma balance sheet. Complete this question by entering your answers in the tabs below. Required A Required B Required Required D Determine the amount of ending inventory Vernon will report on the end-of-quarter pro forma balance sheet. Ending inventory Vernon, Inc. sells fireworks. The company's marketing director developed the following cost of goods sold budget for April, May, June, and July. April May Budgeted cost of goods sold $71,000 $81,000 June $91,000 July $97,000 Vernon had a beginning inventory balance of $4,300 on April 1 and a beginning balance in accounts payable of $15,400. The company desires to maintain an ending inventory balance equal to 15 percent of the next period's cost of goods sold. Vernon makes all purchases on account. The company pays 70 percent of accounts payable in the month of purchase and the remaining 30 percent in the month following purchase. Required a. Prepare an inventory purchases budget for April, May, and June. b. Determine the amount of ending inventory Vernon will report on the end-of-quarter pro forma balance sheet. c. Prepare a schedule of cash payments for inventory for April, May, and June. d. Determine the balance in accounts payable Vernon will report on the end-of-quarter pro forma balance sheet. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Prepare a schedule of cash payments for inventory for April, May, and June. (Round your final answers to the nearest whole dollar.). April May June Schedule of Cash Payments Payment of current accounts payable Payment of previous accounts payable Total budgeted payments for inventory
