Harney, Inc. has prepared the following budgets for March. In March, budgeted production equals budgeted sales, and raw materials inventory will stay constant. What is budgeted cost of goods sold for March?

Question

Harney, Inc. has prepared the following budgets for March. In March, budgeted production equals budgeted sales, and raw materials inventory will stay constant.  What is budgeted cost of goods sold for March?

Quizplus · Accepted Answer

The budgeted cost of goods sold can be calculated by subtracting the budgeted ending finished goods inventory from the sum of beginning finished goods inventory and the cost of goods manufactured. Based on the given budgets, the budgeted cost of goods sold for March is ($5,000 + $11,000) - $2,440 = $13,560.