es Exercise 14-10A (Algo) Preparing inventory purchases budgets with different assumptions LO 14-3 Executive officers of Thornton Company are wrestling with their budget for the next year. The following are two different sales estimates provided by two difference sources. Source of Estimate Sales manager Marketing consultant First Second Third Quarter Quarter Quarter $373,000 $318,000 $286,000 524,000 466,000 414,000 Fourth Quarter $477,000 659,000 Thornton's past experience indicates that cost of goods sold is about 60 percent of sales revenue. The company tries to maintain 15 percent of the next quarter's expected cost of goods sold as the current quarter's ending inventory. This year's ending inventory is $35,000. Next year's ending inventory is budgeted to be $36,000. Required a. Prepare an inventory purchases budget using the sales manager's estimate. b. Prepare an inventory purchases budget using the marketing consultant's estimate.

Exercise 14-10A (Algo) Preparing inventory purchases budgets with different assumptions LO 14-3 Executive officers of Thornton Company are wrestling with their budget for the next year. The following are two different sales estimates provided by two difference sources. Thornton's past experience indicates that cost of goods sold is about 60 percent of sales revenue. The company tries to maintain 15 percent of the next quarter's expected cost of goods sold as the current quarter's ending inventory. This year's ending inventory is $35,000. Next year's ending inventory is budgeted to be $36,000. Required a. Prepare an inventory purchases budget using the sales manager's estimate. b. Prepare an inventory purchases budget using the marketing consultant's estimate