posted by Brian .
Sherman's interiors sells lamps. At March 31, the company had 400 sofas in inventory. The company's policy is to maintain a lamp inventory equal to 2% of next month's sales. The company expects the following sales activity for the second quarter of the year:
April----- 1,000 lamps
May------- 1,400 lamps
June------ 2,000 lamps
What is the projected production for May?
A.) 1,332 lamps
B.) 1,468 lamps
C.) 1,388 lamps
D.) 1,412 lamps
The way I did it was I took 2% of June's sales (2000x2%) to get 40 and just added that to May's sales of 1400 to get 1440. That wasn't the answer though. Thanks for any help.
Sorry guys. That part is supposed to say 400 lamps, not 400 sofas.