Cross Country Apparel plans to sell 22,000 ladders in May and 34,000 ladders in June.Cross Country keeps 10% of the next month's sales as ending inventory.If April's ending inventory reflects this policy, how many ladders should be produced in May?

Question

Quizplus · Accepted Answer

To calculate the number of ladders to be produced in May, we need to consider the sales planned for May, the desired ending inventory for May (which is 10% of June's sales), and the beginning inventory for May (which is April's ending inventory). The calculation is as follows: May's production = May's sales + June's ending inventory (10% of June's sales) - April's ending inventory. Given that April's ending inventory is 10% of May's sales (2,200 ladders), and June's ending inventory should be 10% of June's sales (3,400 ladders), the production for May should be 22,000 (May's sales) + 3,400 (June's ending inventory) - 2,200 (April's ending inventory) = 23,200 ladders.

Cross Country Apparel Plans to Sell 22,000 Ladders in May