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Walker Company prepares monthly budgets. Company policy is to end each month with merchandise inventory equal to 15% of budgeted unit sales for the following
Walker Company prepares monthly budgets. Company policy is to end each month with merchandise inventory equal to 15% of budgeted unit sales for the following month. Budgeted sales and merchandise purchases for the next three months follow. Beginning inventory on July 1 is 27,000 units. The company budgets sales of 200,000 units in October. The merchandise cost per unit is $2. \begin{tabular}{lccr|} & July & August & September \\ Budgeted sales units & 180,000 & 315,000 & 270,000 \\ Units to purchase & 200,250 & 308,250 & 259,500 \end{tabular} Prepare the merchandise purchases budgets for the months of July, August, and September. \begin{tabular}{|l|l|l|l|} \hline \multicolumn{2}{|c|}{ WALKER COMPANY } \\ \hline & Jerchandise Purchases Budget \\ \hline Budgeted ending inventory (units) & & & \\ \hline & & & \\ \hline Next period budgeted sales units & & & \\ \hline Ratio of inventory to future sales & & & \\ \hline & & & \\ \hline Total required units & & & \\ \hline & & & \\ \hline Units to purchase & & & \\ \hline Cost per unit & & & \\ \hline Cost of merchandise purchases & & \\ \hline \end{tabular}
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