Dolly's Place After years of teaching retailing and marketing at the University of Southern Mississippi, Dolly Moyd decided to retire and return to her first love-running an apparel store on the Gulf Coast. Recause she used to run such a department for a major retail chain before teaching, she kept with the current trends in the industry. Dolly gained the support of an ex-high-school classmate who, after making millions with an Internet startup, financed her new endeavor. Today Dolly is beginning to make plans for the upcoming fall season. Dolly anticipates planned sales of S400,000 for the fall season based on a planned initial markup of 48 percent. Within the season, planned monthly sales are projected to be as follows: 15 percent in August and September, 10 percent in October, 20 percent in November, 30 percent in December, and 10 percent in January. To ensure a profitable season, trade association records were consulted. The records indicated the following: (1) The stock-to-sales ratios need to be 3.5 for August, 3.0 for September, 40 for 3.0 November, 2.5 for December, and 5.5 for January; 2) reductions can be planned at 10 percent for the first four months, 20 percent for December, and 40 percent for January; and (3) with Valentine's Day approaching, an inventory of s220,000 will be necessary to begin the spring season. Complete a six-month merchandise budget for Dolly. Date: May 23 Dolly's Place Season: Fall Six-Month Merchandise Budget Spring/Summer Aug Sept oct Nov Dec Jan Seasonal Total FallWinter 1. Planned BoM Stock 2. Planned Sales 3. Planned Retail Reductions 4. Planned EOM Stock 5. Planned Purchases e Retail 6. Planned Purchases Cost 7. Planned Initial Markup 8. Planned Gross Margin 2.5 x 9- Planned BoM Stock/Sales Ratio 3.5 x 30 x 40 x 3.0 x x 5,5 100% 10. Planned Sales Percentage 15% 15% 10% 20% 30% 10% 16% 11. Planned Retail Reduction 10% 10% 10% 10% 20% 40% $400,000 Planned total sales for the period 16% Planned total retail reduction percentage for the period 48% manned initial markup percentage for the period $220,000 Planned BoM stock for February Noe The reduction percentage for Dolly's is percent, which is the amount of total reductions ($64.000 uided by total sales Because the 16 add up the reduction sales in each month are different, you cannot parentage for each month and divide the sum by the number of months in the budget