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Dollar amount of Inventory

MJ Department Store expects to generate the following sales figures for the next three months:

July August September
Expected sales $480,000 $560,000 $600,000

MJ's gross profit 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?

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MJ Department Store expects to generate the following sales figures for the next three months:

July August September
Expected ...

Solution Summary

This provides the steps to calculate the Dollar amount of Inventory

$2.19