Question: Tempest Readers sells eReaders Its sales budget for the nine

Tempest Readers sells eReaders. Its sales budget for the nine months ended September 30 follows:

In the past, cost of goods sold has been 60% of total sales. The director of marketing and the financial vice president agree that each quarter’s ending inventory should not be below $ 15,000 plus 15% of cost of goods sold for the following quarter. The marketing director expects sales of $ 220,000 during the fourth quarter. The January 1 inventory was $ 14,000.

Prepare a cost of goods sold, inventory, and purchases budget for each of the first three quarters of the year. Compute cost of goods sold for the entire nine- monthperiod.

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  • CreatedAugust 27, 2014
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