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aleksandrvk [35]
3 years ago
13

Kent Company's May sales budget calls for sales of $900,000. The store expects to begin May with $50,000 of inventory and to end

the month with $55,000 of inventory. Gross margin is typically 45% of sales. Compute the budgeted cost of merchandise purchases for May. $550,000. $500,000. $495,000. $460,000.
Business
1 answer:
Kitty [74]3 years ago
4 0

Answer:

$500,000

Explanation:

Given that:

Sales for the month = $900,000

Opening inventory = $50,000

Closing inventory = $55,000

Gross margin on sales = 45%

Cost of goods sold = 100 - gross margin = 100% - 45% = 55%

Hence,

Cost of goods sold = $900,000 × 55% = $495,000

Therefore, the purchase for the month

= Cost of goods sold + Closing inventory - Opening inventory

= $495,000 + $55,000 - $45,000

= $500,000

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At the present time, Water and Power Company (WPC) has 10-year noncallable bonds with a face value of $1,000 that are outstandin
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d. 2.94%

Explanation:

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