Great Logos buys logo-imprinted merchandise and then sells it to university book

Question

Great Logos buys logo-imprinted merchandise and then sells it to university bookstores. Sales are expected to be $2,003,000 in September, $2,190,000 in October, $2,383,000 in November, and $2,510,000 in December. Great Logos sets its prices to earn an average 30% gross profit on sales revenue. The company does not want inventory to fall below $420,000 plus 15% of the next month's cost of goods sold.

Prepare a cost of goods sold, inventory, and purchases budget for the months of October and November.

Explanation / Answer

Prepare a cost of goods sold, inventory, and purchases budget for the months of October and November.

October November Cost of goods sold 2190000*70%=1533000 2383000*70=1668100 Add: ENding inventory (1668100*15%+420000)=670215 (2510000*70%*15%+420000)=683550 Total needs 2203215 2351650 Less: Beginning inventory (1533000*15%+420000) = (649950) (670215) Purchase 1553265 1681435

Related Questions

Navigate

• Browse (All)
• Browse G
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.