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Lesechka [4]
3 years ago
8

Skymont Company wants an ending inventory each month equal to 30% of that month's cost of goods sold. Cost of goods sold for Feb

ruary is projected at $45,000. Ending inventory at the end of January was $12,000. Based on this information, purchases for February would be:
Business
1 answer:
Law Incorporation [45]3 years ago
5 0

Answer:

Purchases for February would be: $46,500

Explanation:

Prepare a Purchases Budget to find the Purchases for February.

<u>Purchases Budget for February</u>

Budgeted Cost of Sales                                                    $45,000

Add Budgeted Closing Inventory ($45,000 × 30%)         $13,500

                                                                                           $58,500

Less Budgeted Opening Inventory                                 ($12,000)

Budgeted Purchases                                                         $46,500

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