Accounting: What the Numbers Mean 11th Edition by Wayne McManus,Daniel Viele,David Marshall

Exercise 21

Purchases budget Brooklyn Furniture, a retail store, has an average gross profit ratio of 46%. The sales forecast for the next four months follows:

Management's inventory policy is to have ending inventory equal to 300% of the cost of sales for the subsequent month, although it is estimated that the cost of inventory at June 30 will be $410,000.
Required:
Calculate the purchases budget, in dollars, for the months of July and August.