Metro, Inc. sells backpacks. The Company's accountant is preparing the purchases budget for the first quarter operations. Metro maintains ending inventory at 20% of the following month's expected cost of goods sold. Expected cost of goods sold for April is $70,000. All purchases are made on account with 25% of accounts paid in the month of purchase and the remaining 75% paid in the month following the month of purchase. Sales Budgeted cost of goods sold Plus: Desired ending inventory Inventory needed - Less: Beginning inventory Required purchases January February March $40,000 $50,000 $60,000 10,000 50,000 (8,000) $42,000 Based on this information the total cash paid in March to settle accounts payable is
Metro, Inc. sells backpacks. The Company's accountant is preparing the purchases budget for the first quarter operations. Metro maintains ending inventory at 20% of the following month's expected cost of goods sold. Expected cost of goods sold for April is $70,000. All purchases are made on account with 25% of accounts paid in the month of purchase and the remaining 75% paid in the month following the month of purchase. Sales Budgeted cost of goods sold Plus: Desired ending inventory Inventory needed - Less: Beginning inventory Required purchases January February March $40,000 $50,000 $60,000 10,000 50,000 (8,000) $42,000 Based on this information the total cash paid in March to settle accounts payable is
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Please help me with show all calculation thanku
Transcribed Image Text:Metro, Inc. sells backpacks. The Company's accountant is preparing the purchases budget for the first quarter operations. Metro maintains
ending inventory at 20% of the following month's expected cost of goods sold. Expected cost of goods sold for April is $70,000. All
purchases are made on account with 25% of accounts paid in the month of purchase and the remaining 75% paid in the month following the
month of purchase.
Sales
Budgeted cost of goods sold
Plus: Desired ending inventory
Inventory needed
Less: Beginning inventory
Required purchases
January February March
$40,000 $50,000 $60,000
10,000
50,000
(8,000)
$42,000
Based on this information the total cash paid in March to settle accounts payable is
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