Smith & Co. (a retailer) has the following sales forecast: • January: $400,000 • February: $500,000 • March: $550,000 • April: $600,000 Smith & Co. has a gross margin percentage of 40%. Inventory at January 1 is $50,000. Smith & Co. plans to keep enough inventory on hand at the end of each month to cover 25% of the next month's cost of goods sold (COGS). How much inventory (in cost, not units) should Smith & Co. purchase in January? Hint: COGS % is 60%.

Smith & Co. (a retailer) has the following sales forecast: • January: $400,000 • February: $500,000 • March: $550,000 • April: $600,000 Smith & Co. has a gross margin percentage of 40%. Inventory at January 1 is $50,000. Smith & Co. plans to keep enough inventory on hand at the end of each month to cover 25% of the next month's cost of goods sold (COGS). How much inventory (in cost, not units) should Smith & Co. purchase in January? Hint: COGS % is 60%.

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter22: Master Budget (master)

Section: Chapter Questions

Problem 1R: Ranger Industries has provided the following information at June 30: Other information: Average...

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