Question

Cool Water Inc. sells bottled water. The firm keeps in inventory plastic bottles at 10% of the monthly projected sales. These plastic bottles cost $0.005 each. The monthly sales for the coming year are as follows:
January: 2,000,000
February: 2,200,000
March: 2,700,000
April: 3,000,000
May: 3,600,000
June: 5,500,000
July: 7,000,000
August: 9,000,000
September: 6,000,000
October: 4,000,000
November: 2,500,000
December: 1,300,000
January one year out: 2,200,000.

Show the anticipated cost of plastic bottles each month for these projected sales, the beginning inventory volume and ending inventory volume each month, and the monthly increase or decrease in cash flow for inventory given that an increase is a use of cash and a decrease is a source of cash.



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  • CreatedMay 08, 2014
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