Lecture #13b: The Merchandise Budget (Solved)

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Six-Month Merchandise Budget
Item Aug Sep Oct Nov Dec Jan Total
1. Planned BOM Stock 225,000 300,000 300,000 250,000 375,000 300,000 ---
2. Planned Sales 75,000 75,000 100,000 50,000 125,000 75,000 500,000
3. Planned Retail Reductions 7,500 7,500 5,000 7,500 6,250 7,500 41,250
4. Planned EOM Stock 300,000 300,000 250,000 375,000 300,000 250,000 ---
5. Planned Purchases @ Retail 157,500 82,500 55,000 182,500 56,250 32,500 566,250
6. Planned Purchases @ Cost 86,625 45,375 30,250 100,375 30,938 17,875 311,438
7. Planned Initial Markup 70,875 37,125 24,750 82,125 25,312 14,625 254,812
8. Planned Gross Margin 63,375 29,625 19,750 74,625 19,062 7,125 213,562
9. Planned BOM Stock-to-Sales Ratio 3.0 4.0 3.0 5.0 3.0 4.0 ---
10. Planned Sales % 15% 15% 20% 10% 25% 15% 100%
Planned Retail Reduction % 10% 10% 5% 15% 5% 10% 8.25%

Assignment:

Complete the above six-month merchandise plan. Planned total sales for this six-month period are $500,000, with a planned initial markup percentage for the period of 45%. The planned BOM Stock for February is $250,000.

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