Tiger Drug Store carries a variety of health and beauty aids, includi Unit Sales Dollar Sales January 130 $1,040 February 120 960 March 140 1,120 April 150 1,200 May 170 1,360 June 160 1,280

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
Purchases Budget
Tiger Drug Store carries a variety of health and beauty aids, including 500-count bottles of vitamins. The sales budget for vitamins for the first six months of the year is presented below.
Unit Sales
Dollar Sales
January
130
$1,040
February
120
960
March
140
1,120
April
150
1,200
May
170
1,360
June
160
1,280
The owner of Tiger Drug believes that ending inventories should be sufficient to cover 10 percent of the next month's projected sales. On January 1, 25 bottles of vitamins were in inventory.
Required:
1. Prepare a merchandise purchases budget in bottles of vitamins for as many months as you can.
Tiger Drug Store
Merchandise Purchases Budget
January February March
April
May
✓
140
Unit sales
Desired EI
130 ✓
13 X
120 V
12 X
✓
14 X
15 X
17 X
Total needed
143 X
132 X
154 X
165 X
187 X
1.25 X
Less: BI
X
X
X
X
X
X
Unit purchases
X
X
X
2. If vitamins are priced at cost plus 60 percent, what is the dollar cost of purchases for each month of your purchases budget?
January
X
February
X
March
X
April
X
May
X
150
170
Transcribed Image Text:Purchases Budget Tiger Drug Store carries a variety of health and beauty aids, including 500-count bottles of vitamins. The sales budget for vitamins for the first six months of the year is presented below. Unit Sales Dollar Sales January 130 $1,040 February 120 960 March 140 1,120 April 150 1,200 May 170 1,360 June 160 1,280 The owner of Tiger Drug believes that ending inventories should be sufficient to cover 10 percent of the next month's projected sales. On January 1, 25 bottles of vitamins were in inventory. Required: 1. Prepare a merchandise purchases budget in bottles of vitamins for as many months as you can. Tiger Drug Store Merchandise Purchases Budget January February March April May ✓ 140 Unit sales Desired EI 130 ✓ 13 X 120 V 12 X ✓ 14 X 15 X 17 X Total needed 143 X 132 X 154 X 165 X 187 X 1.25 X Less: BI X X X X X X Unit purchases X X X 2. If vitamins are priced at cost plus 60 percent, what is the dollar cost of purchases for each month of your purchases budget? January X February X March X April X May X 150 170
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps with 2 images

Blurred answer
Knowledge Booster
Documentation techniques
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education