Favata Company has the following information:
$$\begin{array} { l c }
\text { Month } & \text { Budgeted Sales } \
\text { June } & \$ 60,000 \
\text { July } & 51,000 \
\text { August } & 40,000 \
\text { September } & 70,000 \
\text { October } & 72,000
\end{array}$$ In addition,the cost of goods sold rate is 70% and the desired inventory level is 30% of next month's cost of sales.
Required:
Prepare a purchases budget for July through September.

Question

Favata Company has the following information:
 $$\begin{array} { l c } 
\text { Month } & \text { Budgeted Sales } \
\text { June } & \$ 60,000 \
\text { July } & 51,000 \
\text { August } & 40,000 \
\text { September } & 70,000 \
\text { October } & 72,000
\end{array}$$ In addition,the cost of goods sold rate is 70% and the desired inventory level is 30% of next month's cost of sales.
Required:
Prepare a purchases budget for July through September.

Quizplus · Accepted Answer

The Answer of Favata Company has the following information:
 $$\begin{array} { l c } 
\text { Month } & \text { Budgeted Sales } \
\text { June } & \$ 60,000 \
\text { July } & 51,000 \
\text { August } & 40,000 \
\text { September } & 70,000 \
\text { October } & 72,000
\end{array}$$ In addition,the cost of goods sold rate is 70% and the desired inventory level is 30% of next month's cost of sales.
Required:
Prepare a purchases budget for July through September.

Favata Company Has the Following Information In Addition,the Cost of Goods Sold Rate Is 70% and }