Freighters Inc. has the following budgeted figures: $\begin{array}{|llccc|}
\hline & \text { Jan } & \text { Feb } & \text { Mar } & \text { April } \
\text { Sales } & \$ 50,000 & \$ 65,000 & \$ 80,000 & \$ 95,000 \
\text { Cost of goods sold } & 60 \% \text { of sales } & & \
\text { Required ending inventory } &{\$ 15,000+25 \% \text { of sales of next month }} \
\text { Inventory on hand on Jan 1st } & \$ 27,500 & & & \
\hline
\end{array}$
Calculate the ending merchandise inventory for the month of March.

Question

Freighters Inc. has the following budgeted figures: $\begin{array}{|llccc|}
\hline & \text { Jan } & \text { Feb } & \text { Mar } & \text { April } \
\text { Sales } & \$ 50,000 & \$ 65,000 & \$ 80,000 & \$ 95,000 \
\text { Cost of goods sold } & 60 \% \text { of sales } & & \
\text { Required ending inventory } &{\$ 15,000+25 \% \text { of sales of next month }} \
\text { Inventory on hand on Jan 1st } & \$ 27,500 & & & \
\hline
\end{array}$
 Calculate the ending merchandise inventory for the month of March.

Quizplus · Accepted Answer

The ending inventory for March is calculated as $15,000 plus 25% of April's sales ($95,000), which equals $15,000 + $23,750 = $38,750.

Freighters Inc Calculate the Ending Merchandise Inventory for the Month of March