Tannwin Co Ending Inventory for Each Month Should Be 20% of the the Following

question 75

Multiple Choice

Tannwin Co.sells a new product called Accountomatic and has predicted the following sales for the first four months of the current year:
$\begin{array}{ccccc} & \text { Jan. } & \text { Feb. } & \text { March } & \text { April } \\\text { Sales in units } & 1,700 & 1,900 & 2,100 & 1,600\end{array}$

Ending inventory for each month should be 20% of the next month's sales,and the prior December 31 inventory is consistent with that policy.How many units should be purchased in the first quarter of the year?

• A) 5,100
• B) 5,680
• C) 6,300
• D) 6,000
• E) 5,700

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