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Purchases Budget in Units and Dollars Budgeted sales of The Music Shop for the first six...

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Accounting

Purchases Budget in Units and Dollars
Budgeted sales of The Music Shop for the first six months of 2010are as follows:

MonthUnit SalesMonthUnit Sales
January130,000April190,000
February150,000May160,000
March210,000June220,000

Beginning inventory for 2010 is 50,000 units. The budgetedinventory at the end of a month is 40 percent of units to be soldthe following month. Purchase price per unit is $7.

Prepare a purchases budget in units and dollars for each month,January through May.

The Music Shop
Purchases Budget
January - May, 2010
JanuaryFebruaryMarchAprilMay
Purchase units:AnswerAnswerAnswerAnswerAnswer
Purchase dollars:$Answer$Answer$Answer$Answer

Mark 0.00 out of 1.00

$Answer

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Ans.

The Music Shop Purchases Budget January - May, 2010
January February March April May
Purchase Units: 140,000 174,000 202,000 178,000 184,000
Purchase Dollars: $980,000 $1,218,000 $1,414,000 $1,246,000 $1.288,000

Purchases Units Calculation

January February March April May
Budgeted Sales 130,000 150,000 210,000 190,000 160,000
Add:- Desired Ending Inventory (40% of Next Month) 60,000 84,000 76,000 64,000 88,000
Total Inventory Needs 190,000 234,000 286,000 254,000 248,000
Less:- Beginning Inventory 50,000 60,000 84,000 76,000 64,000
Purchases Units 140,000 174,000 202,000 178,000 184,000

Purchase Dollers ($7 Per Units)

January February March April May
Budgeted cost of Sales $910,000 $1,050,000 $1,470,000 $1,330,000 $1,120,000
Add:- Desired Ending Inventory $420,000 $588,000 $532,000 $448,000 $616,000
Total Inventory Needs $1,330,000 $1,638,000 $2,002,000 $1,778,000 $1,736,000
Less:- Beginning Inventory $350,000 $420,000 $588,000 $532,000 $448,000
Purchase Dollers $980,000 $1,218,000 $1,414,000 $1,246,000 $1,288,000

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