TechWorks Company sells its smartphone worldwide. The company expects to sell 4,200 smartphones for $ 170 each in January and 3,800 smartphones for $ 200 each in February. All sales are cash only. TechWorks expects cost of goods sold to average 70% of sales revenue. The company also expects to sell 4,300 smartphones in March for $ 280 each. TechWork’s target ending inventory is $ 16,000 plus 40% of the next month’s cost of goods sold.
1. Prepare the sales budget for January and February.
2. Prepare the company’s cost of goods sold, inventory, and purchases budget for January and February.