Answer the following statements true (T) or false (F)
1. For a merchandising company, the budgeted total sales equals the expected number of units sold multiplied by the budgeted selling price per unit
2. The inventory, purchases, and cost of goods sold budget determines cost of goods sold for the budgeted income statement, and ending Merchandise Inventory for the budgeted balance sheet.
3. For a merchandising company, budgeted purchases equals cost of goods sold plus beginning merchandise inventory minus ending merchandise inventory.
4. Keeping merchandise inventory at the maximum level that meets the needs of providing goods to customers, with turning over the merchandise inventory efficiently, helps reduce inventory storage costs, insurance costs, and warehousing costs.
1. TRUE
2. TRUE
3. FALSE
Purchases equals cost of goods sold plus ending merchandise inventory minus beginning
merchandise inventory.
4. FALSE
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