River City Promotions sells custom crested jackets, which it purchases from its suppliers for $20 per unit. To ensure it always has enough stock on hand to meet upcoming needs, it requires an ending inventory for any period to be equal to 30% of the next period's demand. Budgeted sales (in units) for the year ended December 31, 20X1 are as follows: Q1 - 12,200 Q2 - 6,700 Q3 - 15,600 Q4 - 17,200 Assuming that inventory on hand at the beginning of each period matches that planned for in the policy above, what would be the cost of purchases for Q2?

Answer rating: 100% (QA)

To calculate the cost of purchases for Q2 we need to determine the required ending inventory for Q2 ... View the full answer