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BUSI/320 BUSI320 BUSI 320 MODULE 3 CONNECT HOMEWORK 3

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BUSI 320 MODULE 3 CONNECT HOMEWORK 3 Connect homework 3 1. Bambino Sporting Goods makes baseball gloves that are very popular in the spring and early summer season. Units sold are anticipated as follows: Monthly Unit Sales March 3,550 April 7,550 May 12,100 June 10,100 33,300 Total units sold ________________________________________ If seasonal production is used, it is assumed that inventory will directly match sales for each month and there will be no inventory buildup. The production manager thinks the preceding assumption is too optimistic and decides to go with level production to avoid being out of merchandise. He will produce the 33,300 units over four months at a level of 8,325 per month. a. What is the ending inventory at the end of each month? Compare the unit sales to the units produced and keep a running total. b. If the inventory costs $16 per unit and will be financed at the bank at a cost of 12 percent, what is the monthly financing cost and the total for the four months? (Use 1.0 percent as the monthly rate.)

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