Walton Company sells lamps and other lighting fixtures. The purchasing department manager prepared the following inventory purchases budget. Waltons policy is to maintain an ending inventory balance equal to 20 percent of the following months cost of goods sold. Aprils budgeted cost of goods sold is $78,000.

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.

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

Inventory Purchases Budget
	January	February	March
Budgeted cost of goods sold	$56,000	$60,000	$66,000
Plus: Desired ending inventory	12,000
Inventory needed	68,000
Less: Beginning inventory	11,200
Required purchases (on account)	$56,800

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