Linda Candle Company is in the process of preparing its budget for next year. Co

Question

Linda Candle Company is in the process of preparing its budget for next year. Cost of goods sold has been estimated at 50 percent of sales. Product purchases and payments are to be made during the month preceding the month of sale. Wages are estimated at 15 percent of sales and are paid during the month of sale. Other operating costs amounting to 20 percent of sales are to be paid in the month following the month of sales. Sales revenue is forecasted as follows:

Month Sales
February $760,000
March $492,000
April $830,000
May $750,000
June $818,000

What is the amount of fabric purchases during the month of April?

Explanation / Answer

Cost of goods sold has been estimated at 50 percent of sale Wages are estimated at 15 percent of sales and are paid during the month of sale. 20 percent of sales are to be paid in the month following the month of sales. amount of fabric purchased in april = 0.50* exact sales in may = 0.5(750000 + 20% sales of june -20% sales of april) =373800 plz rate lifesaver

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