Norton Company prepared the following sales budget:
- Month Budgeted Sales
- March $200,000
- April 180,000
- May 220,000
- June 260,000
The expected gross profit rate is 40% and the inventory at the end of February was $36,000. Desired inventory levels at the end of the month are 30% of the next month's cost of goods sold.
1. What is the desired beginning inventory on June 1?
2. What is the desired ending inventory on May 31?
3. What is the desired cost of goods sold for May?
4. What are the total purchases budgeted for April?
5. What are the total purchases budgeted for May?