Weltin Industrial Gas Corporation supplies acetylene and other compressed gases to industry. Data regarding the store's operations follow:

• Sales are budgeted at $390,000 for November, $370,000 for December, and $380,000 for January.
• Collections are expected to be 90% in the month of sale, 5% in the month following the sale, and 5% uncollectible.
• The cost of goods sold is 60% of sales.
• The company purchases 70% of its merchandise in the month prior to the month of sale and 30% in the month of sale. Payment for merchandise is made in the month following the purchase.
• Other monthly expenses to be paid in cash are $21,800.
• Monthly depreciation is $18,000.
Prepare a Merchandise Purchases Budget for November and December.

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https://www.askmehelpdesk.com/finance...-b-u-font.html

I will get you started. If you'd like to post again with your attempt at the problem, we can check it and tell you if you are on the right track.

Start with a spreadsheet showing the expected sales in each month. You know that COGS are 60% of sales, so you can calculate the COGS for the month. Your problem states 70% are purchased in the previous month and 30% in the month of sale. With this info, you can compute the purchases in November and December. Just take this one step at a time and please ask if you get confused, but it would help if you show your work. We can then see what is confusing you. There is info in your question that does not apply to the purchases budget, but will most likely apply as you get further into this question - I'm assuming there will be several parts to your problem.

This is what I got so far:

Nov 390,000= 741,000
Dec 370000=388500
Jan 380000=381900

Now where do I go from here