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Keggler's Supply is a merchandiser of three different products. The company's February 28 inventories are footwear, 21,000 units; sports equipment, 82,000 units; and apparel, 48,000
Keggler's Supply is a merchandiser of three different products. The company's February 28 inventories are footwear, 21,000 units; sports equipment, 82,000 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 31% of the expected unit sales for the following month. Expected sales in units for March, April, May, and June follow. Footwear Sports equipment Apparel Budgeted Sales in Units March April May June 15,500 26,000 30,500 35,000 71,000 91,500 94,500 91,000 41,500 37,500 32,500 24,000 Required: 1. Prepare a merchandise purchases budget (in units) for each product for each of the months of March, April, and May. April May KEGGLER'S SUPPLY Merchandise Purchases Budget For March, April, and May March FOOTWEAR Budgeted sales for next month Ratio of ending inventory to future sales 319 Budgeted ending inventory 8.080 Budgeted units sales for month Required units of available merchandise Actual (or estimated) beginning inventory Budgeted purchases SPORTS EQUIPMENT Budgeted sales for next month Ratio of ending inventory to future sales Budgeted ending inventory Budgeted units sales for month Required units of available merchandise Actual (or estimated) beginning inventory Budgeted purchases APPAREL Budgeted sales for next month Ratio of ending inventory to future sales Budgeted ending inventory Budgeted units sales for month Required units of available merchandise Actual (or estimated) beginning inventory Budgeted purchases
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