Antonio Banderos & Scarves makes headwear that is very popular in the fall-winter season. Units sold are anticipated as:

October	2,250
November	3,250
December	6,500
January	5,500
	17,500	units

If seasonal production is used, it is assumed that inventory will directly match sales for each month and there will be no inventory buildup.

However, Antonio decides to go with level production to avoid being out of merchandise. He will produce the 17,500 items over four months at a level of 4,375 per month.

a.	What is the ending inventory at the end of each month? Compare the unit sales to the units produced and keep a running total. (Leave no cells blank - be certain to enter "0" wherever required.)

	Ending Inventory
October	units
November	units
December	units
January	units

b.	If the inventory costs $4 per unit and will be financed at the bank at a cost of 12 percent, what is the monthly financing cost and the total for the four months? (Use 1 percent as the monthly rate.) (Leave no cells blank - be certain to enter "0" wherever required.)

	Inventory Financing Cost
October	$
November
December
January
Total financing cost	$