Montrose Instrumentation produces measurement equipment. One component, used in a variety of the company’s products, is critical, and the supply chain often breaks. For that reason, Montrose has a policy to hold in inventory enough of the component to produce three months’ worth of sales (one component is used in each unit of product in which it is used). On February 1, the company has 30,000 components in stock. Sales of the units in which the component is used in each of the next six months are estimated to be as follows:

Parts are purchased at a wholesale price of $45. The vendor has a financing arrangement by which Montrose pays 40 percent of the purchase price in the month when the components are delivered and 60 percent in the following month. Montrose purchased 37,500 parts in January. 

Required

a. Estimate purchases of the component (in units) for February and March.

b. Estimate the cash disbursements for the component in February and March.

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February.... March.... April .... May June.... July.... ... 32,250 26,250 27,750 33,300 29,900 41,860