Answer:
Month April May June
Purchases budget 1,832 1,140 1,206
Explanation:
<em>Purchase budget is determined as follows:</em>
<em>Sales budget + closing inventory - opening inventory</em>
'000
Month April May June July
Sales Units 1,600 1,280 930 1,620
Opening inventory (280) ( 512 ) (372 )
Closing inv.(40% of next mth) <u>512 372 648</u>
Purchase budget <u>1,832 1,140 1,206</u>
<em>Note that the closing inventory for a particular becomes the opening inventory for the next following month.</em>
<em>For example, the closing inventory figure of April ( 512 ) is the opening inventory for May.</em>
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