Suggest business conditions

Assignment Help Financial Accounting

Reference no: EM13919828

Kegglerâ€™s Supply is a merchandiser of three different products. The companyâ€™s February 28 inventories are footwear, 20,000 units; sports equipment, 80,000 units; and apparel, 50,000 units. Management believes that excessive inventories have accumulated for all three products. As a result, a new policy dictates that ending inventory in any month should equal 30% of the expected unit sales for the following month. Expected sales in units for March, April, May, and June follow.

Required
1. Prepare a merchandise purchases budget (in units) for each product for each of the months of March, April, and May.
Analysis Component
2. The purchases budgets in part 1 should reflect fewer purchases of all three products in March compared to those in April and May. What factor caused fewer purchases to be planned? Suggest business conditions that would cause this factor to both occur and impact the company in this way.

Reference no: EM13919828

Questions Cloud

Determining production capacity : Determining Production Capacity Needed at Toyota Motor Manufacturing of Canada (TMMC) A. To maximize profit earned during this period, which production capacity should TMMC in 2000 decide to build - 10,000, 15,000, 20,000, 25,000, or 30,000 cars?

Analysts expect the company''s dividend to grow : A stock just paid a dividend of D0 = $1.1. The required rate of return is rs = 9.2%, and the constant growth rate is g = 6%. What is the current stock price?

What are low inflation rates called : Which of the following trends in the new business environment is concerned with the length of time it takes to develop, manufacture, and deliver a product?

Yield to maturity on the delicious mills bonds : 5 years ago, Delicious Mills, Inc. issued 30-year to maturity bonds that had a 8.61 percent annual coupon rate, paid semiannually. The bonds had a $1,000 face value. Since then, interest rates in general have changed and the yield to maturity on the ..

Suggest business conditions : Management believes that excessive inventories have accumulated for all three products. As a result, a new policy dictates that ending inventory in any month should equal 30% of the expected unit sales

Unscrupulous lender-what is the effective interest rate : Imagine you are discussing a loan with a somewhat unscrupulous lender. You want to borrow $20,000 for one year. The interest rate is 12.5 percent. You and the lender agree that the interest on the loan will be 0.125 × $20,000 = $2,500. So the lender ..

The following selected financial information is available : The following selected financial information is available for Best, Inc. Amounts are in millions of dollars.

What is the value of the unlevered firm and tax shield : Merger Valuation with Change in Capital Structure Hastings Corporation is interested in acquiring Vandell Corporation. Vandell has 1 million shares outstanding and a target capital structure consisting of 30% debt; its beta is 1.50. What is the value..

Burden of proof in employment discrimination : HR legal environments are constantly changing. The court case that set the standard to place the burden of proof in employment discrimination on the company was:

User Account

All Pages