Teleco Corp. is preparing its budget for the first quarter of 2018. The following data is provided: Inventory, Purchases, and COGS Budget Jan Feb March Cost of goods sold (a) $30,000 $29,000 $22,500 Desired ending inventory (b) 12,900 12,250 ? Total inventory required 42,900 41,250 Less: Beginning inventory (15,000) (12,900) Budgeted Purchases $27,900 $28,350 (a) COGS = 75% of sales (b) $10,000 + 10% of COGS for next month April's cost of goods sold is $34,000. The amount of Merchandise Inventory to be shown on the budgeted balance sheet at March 31 would be ________.
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.
Teleco Corp. is preparing its budget for the first quarter of 2018. The following data is provided:
|
Inventory, Purchases, and COGS Budget |
Jan |
Feb |
March |
|
Cost of goods sold (a) |
$30,000 |
$29,000 |
$22,500 |
|
Desired ending inventory (b) |
12,900 |
12,250 |
? |
|
Total inventory required |
42,900 |
41,250 |
|
|
Less: Beginning inventory |
(15,000) |
(12,900) |
|
|
Budgeted Purchases |
$27,900 |
$28,350 |
|
|
(a) COGS = 75% of sales |
|
|
|
|
(b) $10,000 + 10% of COGS for next month |
|
|
|
April's cost of goods sold is $34,000. The amount of Merchandise Inventory to be shown on the budgeted
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