Exercise 21-20 (Part Level Submission)
(a)
Open Show Work
SHOW SOLUTION
SHOW ANSWER
LINK TO TEXT
(b)
Open Show Work
![\"\"](\"//edugen.wileyplus.com/edugen/art2/common/pixel.gif\") | | Exercise 21-20 (Part Level Submission) In May 2017, the budget committee of Grand Stores assembles the following data in preparation of budgeted merchandise purchases for the month of June.
| 1. | | Expected sales: June $512,200, July $620,600. | | 2. | | Cost of goods sold is expected to be 75% of sales. | | 3. | | Desired ending merchandise inventory is 30% of the following (next) month’s cost of goods sold. | | 4. | | The beginning inventory at June 1 will be the desired amount. | | | | | | | |
(a) | ![\"Correct](\"//edugen.wileyplus.com/edugen/art3/questionFeedback/icon_correct.svg\") | Your answer is correct. | | | Compute the budgeted merchandise purchases for June. (Round answers to the nearest whole dollar, e.g. 5,275.)
GRAND STORES
Merchandise Purchases Budget June 30, 2017For the Quarter Ending June 30, 2017For the Month Ending June 30, 2017 | | Direct Materials PurchasesDirect Materials per UnitRequired Merchandise PurchasesDesired Ending Merchandise InventoryUnits to Be ProducedTotal Materials RequiredBeginning Merchandise InventoryBudgeted Cost of Goods Sold | | $
| | LessAdd : Beginning Merchandise InventoryDesired Ending Merchandise InventoryBudgeted Cost of Goods SoldDirect Materials per UnitDirect Materials PurchasesRequired Merchandise PurchasesUnits to Be ProducedTotal Materials Required | |
| | Direct Materials PurchasesBudgeted Cost of Goods SoldRequired Merchandise PurchasesUnits to Be ProducedTotal Materials RequiredBeginning Merchandise InventoryDesired Ending Merchandise InventoryDirect Materials per Unit | |
| | LessAdd : Direct Materials PurchasesTotal Materials RequiredDirect Materials per UnitUnits to Be ProducedRequired Merchandise PurchasesBeginning Merchandise InventoryBudgeted Cost of Goods SoldDesired Ending Merchandise Inventory | |
| | Required Merchandise PurchasesUnits to Be ProducedTotal Materials RequiredBeginning Merchandise InventoryBudgeted Cost of Goods SoldDesired Ending Merchandise InventoryDirect Materials per UnitDirect Materials Purchases | | $
| | Click if you would like to Show Work for this question: | Open Show Work | | SHOW SOLUTION SHOW ANSWER | | LINK TO TEXT | | | | | | | |
(b) Prepare the budgeted multiple-step income statement for June through gross profit.
GRAND STORES
Budgeted Income Statement ![\"\"](\"//edugen.wileyplus.com/edugen/art2/common/pixel.gif\"/) For the Month Ending June 30, 2017June 30, 2017For the Quarter Ending June 30, 2017
| | Expected SalesBudgeted Cost of Goods SoldBeginning Merchandise InventoryUnits to Be ProducedBudgeted Cost of Goods Available for SaleDesired Ending Merchandise InventoryTotal Materials RequiredDirect Materials PurchasesBudgeted Gross ProfitRequired Merchandise Purchases | | $
| | Units to Be ProducedTotal Materials RequiredExpected SalesBudgeted Cost of Goods SoldBudgeted Gross ProfitBeginning Merchandise InventoryDesired Ending Merchandise InventoryBudgeted Cost of Goods Available for SaleDirect Materials PurchasesRequired Merchandise Purchases | | | | Budgeted Cost of Goods Available for SaleExpected SalesBeginning Merchandise InventoryDirect Materials PurchasesBudgeted Gross ProfitRequired Merchandise PurchasesDesired Ending Merchandise InventoryUnits to Be ProducedBudgeted Cost of Goods SoldTotal Materials Required | |
| | Budgeted Cost of Goods SoldTotal Materials RequiredBeginning Merchandise InventoryUnits to Be ProducedDesired Ending Merchandise InventoryExpected SalesBudgeted Gross ProfitBudgeted Cost of Goods Available for SaleRequired Merchandise PurchasesDirect Materials Purchases | |
| | Total Materials RequiredBudgeted Gross ProfitUnits to Be ProducedDirect Materials per UnitDirect Materials PurchasesRequired Merchandise PurchasesExpected SalesBudgeted Cost of Goods Available for SaleBeginning Merchandise InventoryDesired Ending Merchandise Inventory | |
| | Units to Be ProducedTotal Materials RequiredBeginning Merchandise InventoryBudgeted Cost of Goods Available for SaleDirect Materials per UnitRequired Merchandise PurchasesExpected SalesDirect Materials PurchasesDesired Ending Merchandise InventoryBudgeted Gross Profit | |
| | Desired Ending Merchandise InventoryDirect Materials PurchasesBudgeted Cost of Goods Available for SaleRequired Merchandise PurchasesUnits to Be ProducedBudgeted Cost of Goods SoldExpected SalesBudgeted Gross ProfitBeginning Merchandise InventoryTotal Materials Required | |
| | Desired Ending Merchandise InventoryBudgeted Gross ProfitExpected SalesDirect Materials PurchasesTotal Materials RequiredBudgeted Cost of Goods SoldBudgeted Cost of Goods Available for SaleRequired Merchandise PurchasesBeginning Merchandise InventoryUnits to Be Produced | | $
| | Click if you would like to Show Work for this question: | Open Show Work | | | | |
a)
b)
| GRAND STORES |
| Merchandise purchase budget |
| For the month ending June 30 |
| Budgeted cost of goods sold ($512,200*75%) | $ 384,150 |
| Add: Desired ending merchandise inventory ($620,600*75%*30%) | $ 139,635 |
| Total merchandise inventory required | $ 523,785 |
| Less: Beginning merchandise inventory ($512,200*75%*30%) | $ 115,245 |
| Required merchandise purchases | $ 408,540 |
Homework Sourse
