Use the Information Below to Answer the Following Question(s)

question 171

Multiple Choice

Use the information below to answer the following question(s) .
Peabody Enterprises prepared the following sales budget:

The expected gross profit rate is 40% and the inventory at the end of February was $10,000. Desired inventory levels at the end of the month are 20% of the next month's cost of goods sold.
-What is the desired beginning inventory on June 1 at Peabody Enterprises?

• A) $1,120
• B) $1,680
• C) $1,440
• D) $8,400

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Definitions:

Standardized Good

a product that is produced to a set standard, making it interchangeable with similar products.

Economic Values

The worth of goods or services determined by the market, where price represents the quantity of resources people are willing to exchange for it.

Absolute Purchasing Power Parity

The economic theory that the price of a good should be the same in different countries when expressed in a common currency, accounting for exchange rates.

Trade Barriers

Measures implemented by a country to restrict or regulate international trade, including tariffs, quotas, and import bans.