Part 1: Buy plan

25 pts

The knit department will be running an ad on short sleeve cotton tee shirts. The buyer estimates she

will need 1,200 units for her ten stores. She must maintain the department mark up goal of 52%.

Her past selling indicates the following % of selling for each color:

Color

%

White

30%

Black

20%

Red

15%

Navy

15%

Gree

10%

Pink

10%

Total

100%

She has noticed that white tee shirt sales have been dropping off, she would like to increase her sales in black

and red. However, the cost is higher in the dark colors. Will she be able to maintain her department's plan

markup of 52% if she changes her purchase to plan for 23% of her sales in black and 17% of her sales in red,

lowering her white to 25% of sales? She is going to retail all colors at $20.00.

What is the most she will be able to pay for the assorted colors and maintain her markup plan?

The same percent by color will be maintained.

Cost price:

Color

Unit price ea

White

$9.00

Black

$9.80

Asst. Color

???

Using the chart below, plan for a purchase of 1,200 units with new sales plan percents by color.

1. Units by color

2. Calculate total cost dollars by color and department total

3. Calculate total retail dollars by color and department total

4. Calculate markup % by color

5. Calculate markup % by total department

Dept Goals

and/or plan

Units

Cost EA

Cost $ Total

Retail EA

Retail $ Total

MU%

C%

White

Black

Red

Navy Blue

Green

Pink

Dept Goal

Total

0

$0.00

$0.00

54%

0%

Yes, she would maintain markup

Part 2: Purchase Order:

30 pts

Use the purchase order below to place an order for the tee shirt promotion.

AAU Retail Store

Purchase Order

79 New Montgomery St

P.O. NUMBER

San Francisco, CA 94105

Vendor Name and Address

Ship To

PURCHASE ORDERS

Department

Department #

Start Ship

Cancellation

FOB

Terms

PO Date

Style Number

Color

Units *

Unit Cost

Total Cost

Unit Retail

Total Retail

Markup %

TOTALS

0

$0.00

$0.00

Buyer Signature

DMM Signature

*Purchase orders can also be divided by specific quantities by store location.

orders can also be divided by specific quantities by store location.

Part 3: Additional calculations:

10 points

Using the information from your purchase order you will calculate the amount you will submit to vendor for purchase order #12392, the vendor prepaid the shipping amount of $158.00

The freights terms are FOB Factory

1. Calculate a discount of 10% on the order, which you negotiated on the first cost.

New Total Cost:______________________

2. Calculate the revised markup percent for the order before payment terms are applied.

Revised Markup percent based on discount:________________________

3. Calculate the cash discount to be received if the order is received on March 10th and paid on April 10th. _____________________________________

With terms of 8/10EOM

4. How much will the freight amount be for order #12392?______________________________

5. Determine the amount to be paid to the vendor for order #12392______________________

__________________________________________________________________________________

Part 4: Markdowns and Maintained Markup

25 points

SKU

Cost $

Retail $

IMU%

Unit Buy

Initital Cost

Initial Retail

Unit Sales

Dollar sales

Sell Through

Units to be

Units sold at

Dollar Sales

Markdown $

Balance on

Dollar Sales

Markdown $

Balance on

Dollar Sales

Markdown $

Total Dollar

Total dollar

Style #71553

$ Total

$ Total

Full Price

at full price

%

Markdown

30% off

at 30% off

at 30% off

Hand

at 50% off

at 50% off

Hand

at 70% off

at 70% off

Sales

Markdown

White

$20.00

36

152

112

10

Black

$20.00

24

128

124

24

Red

$20.00

18

86

100

20

Navy

$20.00

16

78

86

38

Green

$20.00

10

42

68

20

Pink

$20.00

13

46

61

21

Total

Part 5: Conclusion

10 pts.