The following information applies to the questions displayed below Formworks Com

Question

The following information applies to the questions displayed below Formworks Company prepares monthly budgets. The current budget plans for a September ending inventory of 15,000 units. Company policy is to end each month with merchandise inventory equal to a specified percent of budgeted sales for the following month. Budgeted sales and merchandise purchases for the three most recent months follow Sales (Units) Purchases (Units) July August 120,000 210,000 80,000 138,000 204,000 159,000 10.00 points 1. Prepare the merchandise purchases budget for the months of July, August, and September. (Input all amounts as positive values. Omit the "%" sign in your response.) FORMWORKS COMPANY Merchandise Purchases Budget For July and SeplemberAugust Next month's budgeted sales Ratio of inventory to next month sales (Click to select (Click to select) Required units of available inventory (Click to select) (Click to select) MacBook Pro esc

Explanation / Answer

1) Merchandise purchases budget : july aug sept Next month's budgeted sales 210000 180000 75000 Ratio of inventory to next month sales 20% 20% 20% sales 120000 210000 180000 CS 42000 36000 15000 reqd units 162000 246000 195000 Less: OS 24000 42000 36000 (balancing figure) 36000/180000=20% purchase 138000 204000 159000 2) Ratio of inventory to next month sales 36000/180000=20% 3) The budgeted units for sale in October 15000/20% 75000

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