Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Charlie's Cycles Inc. has $150 million in sales. The company expects that its sales will increase 10% this year. Charlie's CFO uses a simple linear

Charlie's Cycles Inc. has $150 million in sales. The company expects that its sales will increase 10% this year. Charlie's CFO uses a simple linear regression to forecast the company's inventory level for a given level of projected sales. On the basis of recent history, the estimated relationship between inventories and sales (in millions of dollars) is as follows: Inventories = $6 + 0.0790(Sales)

A) Given the estimated sales forecast and the estimated relationship between inventories and sales, what are your forecasts of the company's year-end inventory level? Enter your answer in millions. For example, an answer of $25,000,000 should be entered as 25. Round your answer to two decimal places.

$ _____ million

B) What are your forecasts of the company's year-end inventory turnover ratio? Do not round intermediate calculations. Round your answer to two decimal places.

_____ times

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Finance Book

Authors: Stuart Warner, Si Hussain

2nd Edition

1292401982, 978-1292401980

More Books

Students also viewed these Finance questions

Question

Describe change and total quality management (TQM)?

Answered: 1 week ago

Question

Formulate strategies and recommendations for action on HRM issues.

Answered: 1 week ago