Quarter operations, The company's accountant is preparing

Quarter operations

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Reference no: EM13925282

Metro, Inc. sells backpacks. The company's accountant is preparing the purchases budget for the first quarter operations. Metro maintains ending inventory at 20% of the following month's expected cost of goods sold. Expected cost of goods sold for April is $70,000

Sales Jan Feb Mar

Bud cost of goods sold 40,000 50,000 60,000

Plus: Desired ending inventory 10,000

Inventory needed 50,000

Less: Beginning inventory (8,000)

Required purchases 42,000

Based on this information the total amount of expected purchases for February is

a. 42,000

b. 62,000

c. 52,00

d. None of the answers is correct

Reference no: EM13925282

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