Answer:
1. Computation of Budgeted amount of Merchandise Purchases
Particulars                                        June             July            August
Ending Accounts Payable          $130,000     $300,000      $120,000
Payments on account              <u>$1,500,000 </u>   <u>$1,400,000</u>   <u>$1,400,000</u>
                                                  $1,630,000     $1,700,000   $1,520,000
Beginning Accounts Payable  <u>$150,000  </u>     <u>$130,000  </u>     <u>$300,000  </u>
Purchases                                 <u>$1,480,000</u>    <u>$1,570,000</u>    <u>$1,220,000</u>
2. Computation of Budgeted amount of Cost of Goods Sold
Particulars                                        June             July            August
Beginning inventory                   $260,000   $500,000      $300,000
Purchases                                  <u>$1,480,000</u>   <u>$1,570,000</u>    <u>$1,220,000</u>
Cost of goods AFS                    $1,740,000   $2,070,000   $1,520,000
Ending Inventory                       <u>$500,000  </u>   <u>$300,000  </u>    <u>$330,000</u>
Cost of goods sold                   <u>$1,240,000</u>   <u>$1,770,000</u>    <u>$1,190,000</u>