Parker products, Inc. is a manufacturer whose absorption costing income statement reported sales of $123 million and a net operating loss of $18 million. According to a CVP analysis prepared for management, the company’s break-even point is $115 million in sales.

Required:
Assuming the CVP analysis is correct, it is likely that the company inventory level will increase, decreases, or remained unchanged during the year? Explain.

Answer rating: 100% (QA)

Explanation In the question it is given that the BEP sales in Dollor is 115 where as sales in i... View the full answer