Answer:
The correct answer is A.
Explanation:
Giving the following information:
Marty's Merchandise has budgeted sales as follows for the second quarter of the year: April $ 30,000 May $ 60,000 June $ 50,000
The Cost of goods sold is equal to 70% of sales.
The company wants to maintain a monthly ending inventory equal to 120% of the cost of goods sold for the following month. The inventory on March 31 was below this target and was only $22,000.
May:
Inventory for June= (50.000*0.7)*1.20= $42,000