Sentra Sporting Company sells tennis rackets and other sporting equipment. The purchasing department manager prepared the inventory purchases budget. Sentra's policy is to maintain an ending inventory balance equal to 15% of the following month's cost of goods sold. January's budgeted cost of goodssold is $140,000.OctoberNovember DecemberBudgeted Cost of Goods Sold130,000110,000 120,000Plus: Desired Ending InventoryInventory Needed16,500??146,500??Less: Beginning Inventory19,500??Required purchases (on Account)127,000??What would be the required purchases (on account) for December?Multiple Choice$123,000$140,300$103,000$120,000

A budget is an estimate of preparing a plan to manage the company's revenue and expenses based on…

Sentra Sporting Company sells tennis rackets and other sporting equipment. The purchasing department manager prepared the inventory purchases budget. Sentra's policy is to maintain an ending inventory balance equal to 15% of the following month's cost of goods sold. January's budgeted cost of goods sold is $140,000. Budgeted Cost of Goods Sold October November December 130,000 110,000 120,000 Plus: Desired Ending Inventory Inventory Needed 16,500 146,500 ? Less: Beginning Inventory 19,500 ? Required purchases (on Account) 127,000 ? What would be the required purchases (on account) for December? Multiple Choice $123,000 OOOO $140,300 $103,000 $120,000

Sentra Sporting Company sells tennis rackets and other sporting equipment. The purchasing department manager prepared the inventory purchases budget. Sentra's policy is to maintain an ending inventory balance equal to 15% of the following month's cost of goods sold. January's budgeted cost of goods sold is $140,000. Budgeted Cost of Goods Sold October November December 130,000 110,000 120,000 Plus: Desired Ending Inventory Inventory Needed 16,500 146,500 ? Less: Beginning Inventory 19,500 ? Required purchases (on Account) 127,000 ? What would be the required purchases (on account) for December? Multiple Choice $123,000 OOOO $140,300 $103,000 $120,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Tuscarora, Inc., a merchandising company, has the following budgeted figures: Sales Cost of goods sold Required ending inventory Jan $56,700 60% of sales Feb $64,000 Mar April $88,000 $92,000 $10,000 + 30% of next month's sales $27,500 Inventory on hand on Jan 1 Calculate the budgeted purchases for the month of January. OA. $4,820 OB. $63,220 OC. $35,720 OD. $29,200
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Metro, Incorporated sells backpacks. The Company's accountant is preparing the purchases budget for the first quarter operations. Metro maintains ending inventory at 15% of the following month's expected cost of goods sold. Expected cost of goods sold for April is $78,000. All purchases are made on account with 30% of accounts paid in the month of purchase and the remaining 70% paid in the month following the month of purchase. Sales January $ 44,000 February $ 58,000 Budgeted cost of goods sold Plus: Desired ending inventory Inventory needed Less: Beginning inventory March $ 64,000 8,700 52,700 (6,600) Required purchases $ 43,900 Based on this information the amount of accounts payable appearing on the March 31 pro forma balance sheet is Multiple Choice $19,830. $46,270. $66,100. None of the answers is correct.
The Pizza Merchandise Company has budgeted $52,000 in sales for the month of December. The company's cost of goods sold is 25% of sales. If the company has budgeted to purchase $30,000 in merchandise during December, then the budgeted change in inventory levels over the month of December is: Multiple Choice $22,000 decrease. $17.000 increase. $15,250 increase. $9.000 decrease.
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