Managerial Accounting: E22A-33 Stewart, Inc. sells tire rims. Its sales budget

Managerial AccountingE22A-33 Preparing an operating budget - inventory, purchases, and cost of goods sold budget
Stewart, Inc. sells tire rims. Its sales budget for the nine months ended September 30, 2016, follows:
Quarter Ended Nine-Month Total 
March 31 June 30 Sep 30
Cash sales, 20% 20,000 30,000 25,000 75,000 
Credit sales, 80% 80,000 120,000 100,000 300,000 
Total sales $100,000 $150,000 $125,000 $375,000 
 
In the past, cost of goods sold has been 40% of total sales. The director of marketing and the financial vice president agree that each quarter's ending inventory should not be below $10,000 plus 10% of cost of goods sold for the following quarter.  The marketing director expects sales of $200,000 during the fourth quarter.  The January 1 inventory was $36,000.  
 
Requirements:
1. Prepare an inventory, purchases and cost of goods sold budget for each of the first three quarters of the year.  
2. Compute cost of goods sold for the entire nine-month period.
 
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