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1. Last year's sales for the 6-month period of February to July were $589,345. A 5 percent increase in sales is anticipated this year.

1. Last year's sales for the 6-month period of February to July were $589,345. A 5 percent increase in sales is anticipated this year. Total reductions for the period are planned at 8 percent. The initial markup is planned at 53.9 percent. The buyer desires an ending inventory of $190,000 for the period. Based on an analysis of past sales records and current market trends, the buyer has also made plans for the period in relation to (1) monthly distribution of sales, (2) monthly stock- to-sales ratios, and (3) monthly distribution of planned reductions. These three planning estimates for each month are as follows: Month Feb Mar Apr May June July Sales Distribution 10% 10% 35% 20% 15% 10% Stock-to-Sales Ratio 2.4 2.4 2.1 2.0 2.0 2.0 Reductions Distribution 5% 5% 10% 20% 30% 30% Calculate (1) planned monthly sales, (2) planned monthly BOM, (3) planned monthly EOM, (4) planned monthly reductions, (5) planned purchases at retail, and (6) planned purchases at cost.

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To calculate the planned monthly sales we need to apply the sales distribution percentages to the total sales for the period Planned Monthly Sales Total Sales x Sales Distribution Planned Monthly Sale... blur-text-image

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