Question - Sander Enterprises prepared the following sales budget:
March - $8,000
April - $13,000
May - $12,000
June - $14,000
The expected gross profit rate is 40% and the inventory at the end of February was $10,000. Desired inventory levels at the end of the month are 20% of the next month's cost of goods sold.
What is the desired ending inventory on May 31?
A) $1,680
B) $1,440
C) $8,400
D) $1,120