Zeller Company estimates that 2020 sales will be $40,600 in quarter 1, $52,700 in quarter 2, and $67,000 in quarter 3. Cost of goods sold is 50% of sales. Management desires to have ending finished goods inventory equal to 20% of the next quarter's expected cost of goods sold. Prepare a merchandise purchases budget by quarter for the first 6 months of 2020.

Zeller Company estimates that 2020 sales will be $40,600 in quarter 1, $52,700 in quarter 2, and $67,000 in quarter 3. Cost of goods sold is 50% of sales. Management desires to have ending finished goods inventory equal to 20% of the next quarter's expected cost of goods sold. Prepare a merchandise purchases budget by quarter for the first 6 months of 2020.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 15E: Palmgren Company produces consumer products. The sales budget for four months of the year is...

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