Dawes Designs buys T-shirts for clubs, teams, and other organizations. Dawes takes the shirts and adds the organization's logo. Because of the uncertainty in the timing of the sales and to avoid stock outages, Dawes tries to maintain an inventory of shirts equal to two-month's of sales. The shirts cost $16.50 each and must be paid for in cash. On June 30 of the current year, the company expects to have 16,600 shirts in stock. Sales estimates, based on contracts received and historical data, are as follows for the next six months: July August September October November December 8,020 10,990 Units to be purchased 8,460 9,010 6,480 5,160 Required: a. & b. Estimate purchases (in units) and cash required to make purchases in July, August, and September. DAWES DESIGNS Merchandise Purchases Budget For the Period Ended March 31 (in units) July August September
Dawes Designs buys T-shirts for clubs, teams, and other organizations. Dawes takes the shirts and adds the organization's logo. Because of the uncertainty in the timing of the sales and to avoid stock outages, Dawes tries to maintain an inventory of shirts equal to two-month's of sales. The shirts cost $16.50 each and must be paid for in cash. On June 30 of the current year, the company expects to have 16,600 shirts in stock. Sales estimates, based on contracts received and historical data, are as follows for the next six months: July August September October November December 8,020 10,990 Units to be purchased 8,460 9,010 6,480 5,160 Required: a. & b. Estimate purchases (in units) and cash required to make purchases in July, August, and September. DAWES DESIGNS Merchandise Purchases Budget For the Period Ended March 31 (in units) July August September
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Dawes Designs buys T-shirts for clubs, teams, and other organizations. Dawes takes the shirts and adds the organization's logo.
Because of the uncertainty in the timing of the sales and to avoid stock outages, Dawes tries to maintain an inventory of shirts equal to
two-month's of sales. The shirts cost $16.50 each and must be paid for in cash. On June 30 of the current year, the company expects
to have 16,600 shirts in stock. Sales estimates, based on contracts received and historical data, are as follows for the next six months:
July
August
September
October
November
December
8,020
10,990
8,460
9,010
6,480
5,160
Required:
a. & b. Estimate purchases (in units) and cash required to make purchases in July, August, and September.
Units to be purchased
DAWES DESIGNS
Merchandise Purchases Budget
For the Period Ended March 31
(in units)
July
August
September
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