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Bambino Sporting Goods makes baseball gloves that are very popular in the spring and early summer season. Units sold are anticipated as follows: March 3
Bambino Sporting Goods makes baseball gloves that are very popular in the spring and early summer season. Units sold are anticipated as follows:
March
April
May
June
If seasonal production is used, it is assumed that inventory will directly match sales for each month and there will be no inventory buildup.
The production manager thinks the preceding assumption is too optimistic and decides to go with level production to avoid being out of merchandise. He will produce the units over four months at a level of per month.
What is the ending inventory at the end of each month? Compare the unit sales to the units produced and keep a running total.
If the inventory costs $ per unit and will be financed at the bank at a cost of percent, what are the monthly financing cost and the total for the four months? Use as the monthly rate.
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