Dawes Designs buys T-shirts for clubs, teams, and other organizations. Dawes takes the shirts and adds the organization’s logo. Because of the uncertainty in the timing of the sales and to avoid stock outages, Dawes tries to maintain an inventory of shirts equal to two months of sales. The shirts cost $4.50 each and must be paid for in cash. On June 30 of the current year, the company expects to have 15,400 shirts in stock. Sales estimates, based on contracts received and historical data, are as follows for the next six months: 

Required

a. Estimate purchases (in units) for July, August, and September.

b. Estimate cash required to make purchases in July, August, and September. 

Transcribed Image Text:

July..... August.... September October... November. December.. 6,820 9,790 7,260 7,810 5,280 3,960