In Tune Town, items are organized into Item Chains. To see the different Item Chains and understand which items you need to merge to obtain a specific higher-level item, tap on the item in question and then tap the "i" icon in the Info Panel. This will open a screen displaying all the unlocked items in that particular Item Chain, helping you identify the necessary merges to achieve your desired item.

Items of the last level cannot be further merged. You will know when an item is on its last level when it has the crown icon on it