QUESTION: 67 AT THE BEGINNING OF 2015, ENGLAND DRESSES HAS AN INVENTORY OF $85,000. HOWEVER, MANAGEMENT WANTS TO REDUCE THE AMOUNT OF INVENTORY ON HAND TO $45,000 AT DECEMBER 31. IF NET SALES FOR 2015 ARE FORECAST AT $200,000 AND THE GROSS PROFIT RATE IS EXPECTED TO BE 20%, COMPUTE THE COST OF THE MERCHANDISE WHICH MANAGEMENT SHOULD EXPECT TO PURCHASE DURING 2015.
QUESTION: 67 AT THE BEGINNING OF 2015, ENGLAND DRESSES HAS AN INVENTORY OF $85,000. HOWEVER, MANAGEMENT WANTS TO REDUCE THE AMOUNT OF INVENTORY ON HAND TO $45,000 AT DECEMBER 31. IF NET SALES FOR 2015 ARE FORECAST AT $200,000 AND THE GROSS PROFIT RATE IS EXPECTED TO BE 20%, COMPUTE THE COST OF THE MERCHANDISE WHICH MANAGEMENT SHOULD EXPECT TO PURCHASE DURING 2015.
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter5: Sales And Receivables
Section: Chapter Questions
Problem 57BE
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![QUESTION: 67
AT THE BEGINNING OF 2015, ENGLAND DRESSES HAS AN
INVENTORY OF $85,000. HOWEVER, MANAGEMENT WANTS
TO REDUCE THE AMOUNT OF INVENTORY ON HAND TO
$45,000 AT DECEMBER 31. IF NET SALES FOR 2015 ARE
FORECAST AT $200,000 AND THE GROSS PROFIT RATE IS
EXPECTED TO BE 20%, COMPUTE THE COST OF THE
MERCHANDISE WHICH MANAGEMENT SHOULD EXPECT TO
PURCHASE DURING 2015.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2734d59b-9f6e-4a48-9ef4-051928ad5168%2Fddd93e95-3b52-46c6-9825-1d32c7f49d07%2F0jrocv9_processed.jpeg&w=3840&q=75)
Transcribed Image Text:QUESTION: 67
AT THE BEGINNING OF 2015, ENGLAND DRESSES HAS AN
INVENTORY OF $85,000. HOWEVER, MANAGEMENT WANTS
TO REDUCE THE AMOUNT OF INVENTORY ON HAND TO
$45,000 AT DECEMBER 31. IF NET SALES FOR 2015 ARE
FORECAST AT $200,000 AND THE GROSS PROFIT RATE IS
EXPECTED TO BE 20%, COMPUTE THE COST OF THE
MERCHANDISE WHICH MANAGEMENT SHOULD EXPECT TO
PURCHASE DURING 2015.
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