BW Department Store Expects to Generate the Following Sales for the Next

question 166

Multiple Choice

BW Department Store expects to generate the following sales for the next three months: BW's cost of goods sold is 60% of sales dollars. At the end of each month, BW wants a merchandise inventory balance equal to 25% of the following month's expected cost of goods sold. What dollar amount of merchandise inventory should BW plan to purchase in August?

• A) $330,000
• B) $314,600
• C) $352,800
• D) $327,800

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