Question

Willard's Department Store has budgeted cost of goods sold of $42,000 for its men's shorts in March. Management also wants to have $7,600 of men's shorts in inventory at the end of March to prepare for the summer season. Beginning inventory of men's shorts for March is expected to be $5,500. What dollar amount of men's shorts should be purchased in March?

Answer 1

Answer:

$44,100

Explanation:

Given that,

Budgeted cost of goods sold = $42,000

Desired men's shorts in inventory at the end of March = $7,600

Beginning inventory of men's shorts for March = $5,500

Purchases:

= Cost of goods sold + Desired ending inventory - Beginning inventory

= $42,000 + $7,600 - $5,500

= $44,100

Therefore, the dollar amount of men's shorts should be purchased in March is $44,100.