Question

The purchasing department manager for Perez Company prepared the following supplies purchases budget. Perez's policy is to maintain an ending supplies balance equal to 15 percent of the following month's supplies expense. April's budgeted supplies expense is $80,000 Required a. Complete the supplies purchases budget by filling in the missing amounts. b. Determine the amount of supplies expense the company will report on its first quarter pro forma income statement. c. Determine the amount of ending supplies the company will report on its pro forma balance sheet at the end of the first quarter. Complete this question by entering your answers in the tabs below. Req A Reg B and C Complete the supplies purchases budget by filling in the missing amounts. March $ 68,000 Supplies Purchases Budget January February Budgeted supplies expense $ 58,000 $ 62,000 Plus: Desired ending supplies Supplies needed 67300 Less: Beginning supplies 8.700 Required purchases (on $ 58,600 account)

Answer 1

1) Supplies purchase budget

	January	February	March
Budgeted supplies expense	58000	62000	68000
Add: Desired ending supplies	9300	10200	12000
Supplies needed	67300	72200	80000
Less: Beginning supplies	8700	9300	10200
Required purchase	58600	62900	69800

b) Supplies expense = 58000+62000+68000 = 188000

c) Ending supplies = 12000