Question
Kegglers Supply is a merchandiser of three different products. The companys February 28 inventories are footwear, 20,000 units; sports equipment, 80,500 units; and apparel, 48,000
Kegglers Supply is a merchandiser of three different products. The companys February 28 inventories are footwear, 20,000 units; sports equipment, 80,500 units; and apparel, 48,000 units. Management believes each of these inventories is too high. As a result, a new policy dictates that ending inventory in any month should equal 28% of the expected unit sales for the following month. Expected sales in units for March, April, May, and June follow. Budgeted Sales in Units March April May June Footwear 16,000 23,000 33,000 34,500 Sports equipment 71,000 90,500 95,500 90,500 Apparel 41,000 38,000 34,000 24,000 R
equired: 1. Prepare a merchandise purchases budget (in units) for each product for each of the months of March, April, and May.
KEGGLER'S SUPPLY Merchandise Purchases Budget For March, April, and May March April May FOOTWEAR Budgeted sales for next month Ratio of ending inventory to future sales Required units of available merchandise Budgeted purchases SPORTS EQUIPMENT Budgeted sales for next month Ratio of ending inventory to future sales Required units of available merchandise Budgeted purchases APPAREL Budgeted sales for next month Ratio of ending inventory to future sales Required units of available merchandise Budgeted purchasesStep by Step Solution
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