Dawes Designs buys T-shirts for clubs, teams, and other organizations. Dawes takes the shirts and adds the
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Question:
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 months of sales. The shirts cost $12.50 each and must be paid for in cash. On June 30 of the current year, the company expects to have 16,200 shirts in stock. Sales estimates, based on contracts received and historical data, are as follows for the next six months:
| July | 7,620 |
|---|---|
| August | 10,590 |
| September | 8,060 |
| October | 8,610 |
| November | 6,080 |
| December | 4,760 |
Required:
a. & b. Estimate purchases (in units) and cash required to make purchases in July, August, and September.
| July | Aug | Sept | |
| Units to be purchased | 10070 | ||
| Est. Cost | 125875 |
Expert Answer:
Estimate purchases in units Particulars July August September Estimated Sales 7620 10590 8... View the full answer
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