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Suppose Mallcentral sells 1,000 hardcover books per day at an average price of $30. Assume that Mallcentral’s cost for the books is 75% of the selling price it charges retail customers. Mallcentral has no beginning inventory, but it wants to have a three-day supply of ending inventory. Assume that selling and administrative expenses are $1,000 per day.
Determine Mallcentral’s budgeted purchases for the next (seven-day) week.
- a. $300,000
- b. $225,000
- c. $157,500
- d. $75,000
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