Question
A) For ABC venture, the sales forecast for June is $10M. The July sales are forecasted to increase by 10% over June sales. The Cost
A) For ABC venture, the sales forecast for June is $10M. The July sales are forecasted to increase by 10% over June sales. The Cost of goods sold for all months is 60%. The firm has a policy to have in hand inventory to cover 70% of its sales for the month, and the firm plans an additional safety cushion of $1M worth of inventory.
Find the beginning of July inventory.
$5.62M; $6.86M; $7.34M; $4.90M; or $3.26M
B) For a venture, its sales forecast for August is $12M. The Cost of goods sold for all months is 60%. The firm has a policy to have in hand inventory to cover 70% of its sales for the month, and the firm plans an additional safety cushion of $1M worth of inventory.
Find the end of July inventory.
$2.98M; $5.45M; $6.04M; $7.35M; or $8.16M
--Thank you. Not sure if there is a typo on Question B.
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