Rooney company sells lamps and other lighting fixtures. the purchasing department manager prepared the following inventory purchases budget. rooney’s policy is to maintain an ending inventory balance equal to 10 percent of the following month’s cost of goods sold. april’s budgeted cost of goods sold is $77,000. required complete the inventory purchases budget by filling in the missing amounts. determine the amount of cost of goods sold the company will report on its first quarter pro forma income statement. determine the amount of ending inventory the company will report on its pro forma balance sheet at the end of the first quarter.

6. why the aggregate supply curve slopes upward in the short run in the short run, the quantity of output that firms supply can deviate from the natural level of output if the actual price level in the economy deviates from the expected price level. several theories explain how this might happen. for example, the misperceptions theory asserts that changes in the price level can temporarily mislead firms about what is happening to their output prices. consider a soybean farmer who expects a price level of 100 in the coming year. if the actual price level turns out to be 90, soybean prices will , and if the farmer mistakenly assumes that the price of soybeans declined relative to other prices of goods and services, she will respond by the quantity of soybeans supplied. if other producers in this economy mistake changes in the price level for changes in their relative prices, the unexpected decrease in the price level causes the quantity of output supplied to the natural level of output in the short run.