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Pinsetter's Supply is a merchandiser of three different products. The company's February 28 inventories are footwear, 21,000 units; sports equipment, 81,500 units; and apparel, 49,500 units. Management believes that excessive inventories have accumulated for all three products. 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 Footwear Sports equipment Apparel March April May June 14,500 26,500 33,500 33,500 70,000 90,000 95,000 90,000 41,000 37,500 32,500 22,000 PINSETTER'S SUPPLY Merchandise Purchases Budgets For March, April, and May March April May FOOTWEAR Budgeted sales for next month Ratio of ending inventory to future sales 26500 33500 33500 32% 32% 32% Budgeted ending inventory Add: Budgeted sales 10720 8480 14500 10720 33500 26500 22980 37220 Required units of available merchandise Less: Actual (or budgeted) beginning inventory 44220 Budgeted purchases SPORTS EQUIPMENT Budgeted sales for next month Ratio of ending inventory to future sales Budgeted ending inventory Add: Budgeted sales Required units of available merchandise Less: Actual (or budgeted) beginning inventory V Budgeted purchases APPAREL Budgeted sales for next month Ratio of ending inventory to future sales Budgeted ending inventory Add: Budgeted sales Required units of available merchandise Less: Actual (or budgeted) beginning inventory V Budgeted purchases

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