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28 April, 21:10

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?

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  1. 29 April, 00:48
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    Beginning inventory 4,000 units

    Sales 12,000 units

    Purchase 14,000 units

    Final inventory 6,000 units

    Purchase $ = 14,000 * $75 = $1,050,000

    Explanation:

    In order to have 6,000 suits in Final Inventory the department store must make a Purchase of 14,000 suits.

    Final Inventory = Beginning inventory + Purchases - Sales

    If each suit costs $ 75 then the total purchase will be:

    14,000 * $75 = $1,050,000
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