Freighters,Inc A) $23,600
B) $51,700
C) $24,700
D) $4,500

question 59

Multiple Choice

Freighters,Inc.has the following budgeted figures: Calculate the budgeted purchases for the month of January.
$\begin{array}{|l|l|l|l|l}\hline & \text {Jan } & \text { Feb } & \text { Mar } & \text { April } \\\hline \text { Sales } & \$ 56,200 & \$ 68,000 & \$ 82,000 & \$ 91,000 \\\hline \text { Cost of goods sold } & 50 \% \text { of sales } & & & \\\hline & \$ 10,000+20 \% & & & \\& \begin{array}{l}\text { of next month's } \\\text { sales }\end{array} & & & \\\text { Required ending inventory } & & & & \\\hline \text { Inventory on hand on Jan 1 } & \$ 27,000 & & \\ \hline\end{array}$

• A) $23,600
• B) $51,700
• C) $24,700
• D) $4,500

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Definitions:

Growing Annuity

A financial term that refers to a series of cash flows or payments that grow at a fixed rate per period.

Required Rate

Required Rate, or the minimum expected rate of return on an investment, reflects the investor's risk tolerance and investment criteria.

Cash Flow Growth

The increase in the amount of cash that a company generates over time.

Growing Annuity

A sequence of financial transactions increasing at a steady rate over a limited duration.