Stillwater Corporation manufactures outdoor planters. Budgeted sales and production data for the planters are as follows:
The ending inventory for each month should be equal to 20% of the next month's production needs. Each planter requires one pound of clay in its manufacture. Stillwater Corporation has a policy that the inventory of clay at the end of each month needs to be equal to 20% of the production needs for the following month. At the beginning of January, 480 pounds of clay were in inventory. How many pounds of clay would Stillwater Corporation need to purchase in Month 2?

Question

Stillwater Corporation manufactures outdoor planters. Budgeted sales and production data for the planters are as follows:  
The ending inventory for each month should be equal to 20% of the next month's production needs. Each planter requires one pound of clay in its manufacture. Stillwater Corporation has a policy that the inventory of clay at the end of each month needs to be equal to 20% of the production needs for the following month. At the beginning of January, 480 pounds of clay were in inventory. How many pounds of clay would Stillwater Corporation need to purchase in Month 2?

Quizplus · Accepted Answer

The Answer of Stillwater Corporation manufactures outdoor planters. Budgeted sales and production data for the planters are as follows:  
The ending inventory for each month should be equal to 20% of the next month's production needs. Each planter requires one pound of clay in its manufacture. Stillwater Corporation has a policy that the inventory of clay at the end of each month needs to be equal to 20% of the production needs for the following month. At the beginning of January, 480 pounds of clay were in inventory. How many pounds of clay would Stillwater Corporation need to purchase in Month 2?

Stillwater Corporation Manufactures Outdoor Planters