A department store has budgeted sales of 12,000 men's suits in September. Management wants to have 6,000 suits in inventory at the end of the month to prepare for the winter season. Beginning inventory for September is expected to be 4,000 suits. What is the dollar amount of the purchase of suits if each suit has a cost of $75.

Question

Quizplus · Accepted Answer

To find the dollar amount of purchases, calculate the number of suits needed: Desired ending inventory (6,000) + Sales (12,000) - Beginning inventory (4,000) = 14,000 suits to purchase. Multiply by the cost per suit: 14,000 suits * $75 = $1,050,000.

A Department Store Has Budgeted Sales of 12,000 Men's Suits