Answer Happy

Question 3 10 points McNabb Sporting Goods makes gloves that sell well in the spring and early summer season. A projection of units sold is as follows: March April May Total Units Sold 3,500 7,500 13,000 24,000 If seasonal production is used, it is assumed that inventory will directly match sales for each month and there will be no inventory buildup. The production manager thinks the above assumption is too optimistic and decides to go with level production to avoid being out of merchandise. a. What is the ending inventory at the end of each month? Beginning inventory in March is 4,800 units. b. If the inventory costs $8 per unit and will be financed through the bank at 3 percent per annum, what is the monthly financing cost and the total for the three months?