Purchase Solution

Super Shoes: prepare a cost of goods sold budget

Not what you're looking for?

Ask Custom Question

Question 4

John Nguyen a retailer of Super Shoes has produced the following data:

Budgeted sales for $

January 2009 50,000
February 2009 45,000
March 2009 60,000
April 2009 70,000

- Shoes cost $3 a pair and are sold for $6 a pair
- Closing stock at 31/12/2008 was $12500
- Accounts Payable ( for purchase) at 31/12/2008 was $14,250
- Management now requires closing stock to be equal to 25% of the next month's sales (as from January 2009)

Required:

(a) Cost of goods sold budget for January to March 2009
(b) If purchases of stock are paid for 60% in the next month of purchase and 40% in the following month. How much did John pay the accounts payable in:

(1) January 2009
(2) February 2009
(3) March 2009

Purchase this Solution
Solution Summary

The following posting helps with problems involving cost of goods sold and accounts payable.

Solution Preview

Please see the attached file.

Budgeted Sales
Jan-09 $50,000.00
Feb-09 $45,000.00
Mar-09 $60,000.00
Apr-09 $70,000.00

Cost per pair $3.00
Selling Price per pair $6.00

Closing ...

Solution provided by:
Gaurav Agarwal, MS
Education
  • BE, Bangalore University, India
  • MS, University of Wisconsin-Madison
Recent Feedback
  • "Your explanation to the answers were very helpful."
  • "What does 1 and 0 means in the repair column?"
  • "Went through all of the formulas, excellent work! This really helped me!"
  • "try others as well please"
  • "Thank you, this helped a lot. I was not sure how to plug in those numbers to a formula. This was a great help. Now I have to figure out how to explain cost of capital is used in net present value analysis, and how cost of capital is used in net present value analysis. This stuff gets confusing."
Purchase this Solution
Free BrainMass Quizzes
Understanding Management

This quiz will help you understand the dimensions of employee diversity as well as how to manage a culturally diverse workforce.

Managing the Older Worker

This quiz will let you know some of the basics of dealing with older workers. This is increasingly important for managers and human resource workers as many countries are facing an increase in older people in the workforce

Income Streams

In our ever changing world, developing secondary income streams is becoming more important. This quiz provides a brief overview of income sources.

Marketing Management Philosophies Quiz

A test on how well a student understands the basic assumptions of marketers on buyers that will form a basis of their marketing strategies.

Lean your Process

This quiz will help you understand the basic concepts of Lean.

View More Free Quizzes
Related BrainMass Solutions

  • Managerial Accounting Problems Computed

    Prepare a CVP graph showing cost and revenue data for Shop 48 from zero shoes up to 17,000 pairs of shoes sold each year. Clearly indicate the break-even point on the graph. 3.

  • Cost and batch accounting

    finished goods inventory, cost of goods sold Job cost record, work in process inventory, cost of goods sold, finished goods inventory Question 9. 9.

  • Managerial accounting:contribution margin,residual income

    Cost of goods sold is expected to be 60% of sales. 3. Company policy is to maintain ending merchandise inventory at 25% of the following month's cost of goods sold. 4.

  • Master Budget

    This is 12,600/42,000=30% of the next months cost of goods sold. This gives us the percentage of the desired ending inventory. The cost of goods sold is 60% of the sale.

  • Accounts Payables for Stine Inc.

    The company's marketing director developed the following cost of goods sold budget for April, May, June, and July.

  • Budget Report

    Show in the statements the details of cost of goods sold See attached. See the tab named 'Solution'. For additional clarity, out to the right of several of the numbers you will find a detailed explanation of how the numbers were arrived at.

  • Fresh Fruits Corporation: Next Year's Sales Budget

    Company policy is to keep 10% of the next periods estimated cost of goods sold as the current periods ending inventory. Use cost of goods sold for the first quarter to determine the beginning inventory for the first quarter. A.

  • Inventory using weighted average, FIFO and LIFO

    cost per unit $11.87 Ending inventory 750 $11.87 $8,905.43 Cost of goods sold 10,750 $11.87 $127,644.57 B FIFO Ending inventory 750 $13 $9,750 Cost of goods sold 10,750 $126,800

  • Cost accounting problems

    Actual Comparison with Budget Sales $1,500,000 $100,000 favorable Variable cost of goods sold 700,000 60,000 unfavorable Variable selling and administrative expenses 125,000 25,000 unfavorable Controllable fixed cost of goods sold 170,000 On

View More Related Solutions