Answer:
the budgeted cost of merchandise purchases for July is $313,000
Explanation:
given data
July sales = $550,000
begin July inventory = $57,000
end the month inventory = $40,000
Gross margin = 40% of sales
to find out
budgeted cost of merchandise purchases for July
solution
we will get here cost of sales that is express as
Cost of sales = $550,000 × (1 - 0.40)
Cost of sales = $330,000
and
The budgeted cost of merchandise purchases for July will be
budgeted cost = Closing Stock of Inventory + cost of sales - Opening Stock of inventory ............................1
put here value
budgeted cost = $40,000 + $330,000 - $57,000
budgeted cost = $313,000
so the budgeted cost of merchandise purchases for July is $313,000
