50. A retailer expects monthly sales to be $100,000 and planned reductions from sales to be...

50. A retailer expects monthly sales to be $100,000 and planned reductions from sales to be 8 percent of sales. The retailer wants ending inventory to be $20,000 greater than beginning inventory. Planned purchases at retail are _____. Select one:

a. $100,000

b. $120,000

c. $127,200

d. $128,000

Expert Solution

Answer : The answer is option d : $128,000.

Planned purchase at retail = (Ending inventory - Beginning inventory) + Sales + Planned reduction from sales

=> Planned purchase at retail = 20,000 + 100,000 + 8% of $100,000

=> Planned purchase at retail = $128,000

Hence except option d other options are not correct. Therefore, option d is the correct answer.

Rahul Sunny answered 2 years ago

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