A handbag retailer plans to sell $40,000 worth of handbags in January.Planned reductions are $2,000.Planned inventory for January 1st is $70,000 and planned inventory for January 31st is $60,000.As of January 8th,the retailer has ordered $6,000 worth of handbags for January delivery.What is the open-to-buy for the rest of the month?

Question

Quizplus · Accepted Answer

Open-to-buy is calculated as: Planned Sales + Planned Reductions + Planned End Inventory - Planned Beginning Inventory - Merchandise on Order. So, $40,000 + $2,000 + $60,000 - $70,000 - $6,000 = $26,000.

A Handbag Retailer Plans to Sell $40,000 Worth of Handbags