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Kegglers Supply is a merchandiser of three different products. The companys February 28 inventories are footwear, 19,000 units; sports equipment, 78,000 units; and apparel, 49,000 units. Management believes each of these inventories is too high. As a result, a new policy dictates that ending inventory in any month should equal 32% of the expected unit sales for the following month. Expected sales in units for March, April, May, and June follow.

	Budgeted Sales in Units
	March	April	May	June
Footwear	14,500	27,000	31,000	36,500
Sports equipment	71,500	89,000	95,000	90,000
Apparel	40,000	38,000	33,000	23,000

Problem 22-5AA Merchandising: Preparatlon and analysis of purchases budgets LO P4 Keggler's Supply is a merchandiser of three different products. The company's February 28 inventories are footwear, 19,000 units: sports equipment, 78,000 units; and apparel, 49,000 units. Management believes each of these inventories is too high. As a result, a new policy dictates that ending inventory in any month should equal 32% of the expected unit sales for the following month. Expected sales in units for March, April, May, and June follow. Budgeted Sales in Units March April 14,5 27,8 31,006 36,586 71,58 89,88 95,88 98,88e 48,88 38,98 33,08 23,88e Ma June Footwear Sports equipment Apparel Requlrec 1. Prepare a merchandise purchases budget (in units) for each product for each of the months of March, April, and May. KEGGLER'S SUPPLY Purchases Budget For March, April, and May March April May FOOTWEAR Budgeted sales for next month Ratio of ending inventory to future sales Budgeted ending inventory Budgeted units sales for month Required units of available merchandise 14,500 40% 5.800 27.000 4096 10.800 31.000 4096 12,400 Budgeted purchases SPORTS EQUIPMENT Budgeted sales for next month

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