Precious Stones Limited is a retail jeweler. Most of the firm's business is in jewelry and watches. The firm's average gross profit ratio for jewelry and watches is 71% and 42%, respectively. The sales forecast for the next two months for each product category is as follows: Jewelry May June $ 186,300 143,300 Watches $ 89,500 77,700 The company's policy, which is expected to be achieved at the end of April, is to have ending inventory equal to 160% of the next month's cost of goods sold. Required: a. Calculate the cost of goods sold for jewelry and watches for May and June. b. Calculate a purchases budget, in dollars, for each product for the month of May. Complete this question by entering your answers in the tabs below. Required A Required B Calculate the cost of goods sold for jewelry and watches for May and June. Note: Do not round intermediate calculations. Jewelry Watches Cost of goods sold for May Cost of goods sold for June < Required A Required B >
Precious Stones Limited is a retail jeweler. Most of the firm's business is in jewelry and watches. The firm's average gross profit ratio for jewelry and watches is 71% and 42%, respectively. The sales forecast for the next two months for each product category is as follows: Jewelry May June $ 186,300 143,300 Watches $ 89,500 77,700 The company's policy, which is expected to be achieved at the end of April, is to have ending inventory equal to 160% of the next month's cost of goods sold. Required: a. Calculate the cost of goods sold for jewelry and watches for May and June. b. Calculate a purchases budget, in dollars, for each product for the month of May. Complete this question by entering your answers in the tabs below. Required A Required B Calculate the cost of goods sold for jewelry and watches for May and June. Note: Do not round intermediate calculations. Jewelry Watches Cost of goods sold for May Cost of goods sold for June < Required A Required B >
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Manji
Transcribed Image Text:Precious Stones Limited is a retail jeweler. Most of the firm's business is in jewelry and watches. The firm's average gross profit ratio for
jewelry and watches is 71% and 42%, respectively. The sales forecast for the next two months for each product category is as follows:
Jewelry
May
June
$ 186,300
143,300
Watches
$ 89,500
77,700
The company's policy, which is expected to be achieved at the end of April, is to have ending inventory equal to 160% of the next
month's cost of goods sold.
Required:
a. Calculate the cost of goods sold for jewelry and watches for May and June.
b. Calculate a purchases budget, in dollars, for each product for the month of May.
Complete this question by entering your answers in the tabs below.
Required A Required B
Calculate the cost of goods sold for jewelry and watches for May and June.
Note: Do not round intermediate calculations.
Jewelry
Watches
Cost of goods sold for May
Cost of goods sold for June
< Required A
Required B >
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education