Air jet is going to increase amount of fuel inventory from 7 days in 2014 to 15 days in 2015. Assuming the costs stays at $.70 per liter, cost of capital is 8%, and storage is $250 per day for 1 million liters
How do I Calculate the number of liters currently in inventory Dec 31, 2014 and how many more liters are required to get to 15 days?
Is it simply 870,000/.70 ?= liters?
Additional info:
-inventory at year end = $870,000
-Corporate tax rate=25%