Table 108
a Manager Wants to Forecast the Monthly Demand
for

question 185

Multiple Choice

Table 10.8
A manager wants to forecast the monthly demand
for a machine the company produces.
$$\begin{array} { | c | c | } \hline \text { Month } & \begin{array} { c } \text { No. Machines } \\\text { Sold }\end{array} \\\hline 1 & 50 \\2 & 65 \\3 & 52 \\4 & 56 \\5 & 55 \\6 & 60 \\\hline\end{array}$$
-Use the information in Table 10.8.Calculate the MAD for months 4 through 6 for the three-month moving average forecasts.

• A) less than or equal to 2
• B) greater than 2 but less than or equal to 4
• C) greater than 4 but less than or equal to 6
• D) greater than 6

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Definitions:

Refund Liability

An obligation to return funds to a customer, often recognized in situations where returns or cancellations are expected.

Freight Paid

The cost incurred by a company to transport goods, often recognized as an expense in the income statement.

Operating Expense

Costs associated with the day-to-day operations of a business, excluding the cost of goods sold.

Sales

The total amount of revenue generated by the selling of goods or services.