Walker Company prepares monthly budgets. The current budget plans for a Septembe

Question

Walker Company prepares monthly budgets. The current budget plans for a September ending inventory of 22,000 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 September 190,000 310,000 300,000 202,000 309,000 292,000 (1) Prepare the merchandise purchases budget for the months of July August, and September. WALKER COMPANY Merchandise Purchases Budget For July, August, and September July August September Budgeted ending inventory units 22,000 Required units of available inventory 202,000 309,000 292,000 Units to be purchased 2) Compute the ratio of ending inventory to the next month's sales. July August September 22,000 Budgeted ending inventory units Next month's budgeted sales Ratio of inventory to next month's sales B) How many units are budgeted for sale in October? Units budgeted for sale in October

Explanation / Answer

1 July August September Sales 1,90,000 3,10,000 3,00,000 Add Closing Stock 31,000 30,000 22,000 Less Purchases 2,02,000 3,09,000 2,92,000 Opening stock 19,000 31,000 30,000 2 Merchandise Purchase Budget July August September Budgeted ending inventory units 31,000 30,000 22,000 Required units of available inventory 1,71,000 2,79,000 2,70,000 Units to be purchased 2,02,000 3,09,000 2,92,000 July August September Budgeted ending inventory units 31,000 30,000 22,000 Next month's budgeted sales 3,10,000 3,00,000 2,20,000 Ratio of inventory to next month's sales 10% 10% 10% 3 Units budgeted for sales in October 22,000/10% Units budgeted for sales in October 2,20,000

Related Questions

Navigate

• Browse (All)
• Browse W
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.