Reference no: EM133085656

Question - The Ruggid Jeens Company offers a broad range of clothing it sells in a four-state area. Sales for the four quarters of 2022 are expected to be $1,715,000, $1,789,000, $2,030,000, and $1,750,000, for an annual total of $7,284,000.

Cost of goods sold averages 50% of sales. Ending inventory for each quarter should be 10% of cost of goods sold for the following quarter. Inventory at January 1 is expected to be $85,000.

Required -

-Show calculations for ending inventory, purchases, and cost of goods sold for the first three quarters of 2022.

-Explain in your own words why you could not perform the same calculations for the fourth quarter that you performed for the first three.

-Briefly explain in your own words what additional information the company will need to prepare the schedule of cash collections for the same three quarters.