MJ Department Store expects to generate the following sales figures for the next three months: July $480,000 August $560,000 September $600,000 MJ's gross profit (margin) rate is 45% of sales dollars. At the end of each month, MJ wants a merchandise inventory balance equal to 30% of the following month's expected sales, stated at cost. What dollar amount of merchandise inventory should MJ plan to purchase in August? a. $257,400 b. $314,600 c. $320,000 d. $327,800
MJ Department Store expects to generate the following sales figures for the next three months: July $480,000 August $560,000 September $600,000 MJ's gross profit (margin) rate is 45% of sales dollars. At the end of each month, MJ wants a merchandise inventory balance equal to 30% of the following month's expected sales, stated at cost. What dollar amount of merchandise inventory should MJ plan to purchase in August? a. $257,400 b. $314,600 c. $320,000 d. $327,800
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter8: Budgeting
Section: Chapter Questions
Problem 2CMA
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MJ Department Store expects to generate the following sales figures for the next three months: July $480,000 August $560,000 September $600,000 MJ's gross profit (margin) rate is 45% of sales dollars. At the end of each month, MJ wants a merchandise inventory balance equal to 30% of the following month's expected sales, stated at cost. What dollar amount of merchandise inventory should MJ plan to purchase in August? a. $257,400 b. $314,600 c. $320,000 d. $327,800
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