Marks Company produces staplers.Its sales are projected to be 26,000 in June, 28,000 in July, and 30,000 in August.The company plans to have 15% of the next month's sales in inventory at the end of each month.How many staplers must Marks produce in July?

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Quizplus · Accepted Answer

To calculate the production for July, we need to consider the sales projection for July (28,000 units), the desired ending inventory for July (which is 15% of August's sales), and the beginning inventory for July (which is 15% of July's sales).1. July's sales projection: 28,000 units.2. Desired ending inventory for July (15% of August's sales of 30,000 units): 0.15 * 30,000 = 4,500 units.3. Beginning inventory for July (15% of July's sales of 28,000 units): 0.15 * 28,000 = 4,200 units.To meet July's sales and have the desired ending inventory, Marks needs a total of 28,000 (sales) + 4,500 (desired ending inventory) = 32,500 units available in July.Since the beginning inventory for July is 4,200 units, the production for July needs to be: 32,500 (total needed) - 4,200 (beginning inventory) = 28,300 units.

Marks Company Produces Staplers