Reference no: EM131371476

An inventory application calls for the weekly updating, or posting, of the merchandise inventory master file from the purchases transaction file and the sales transaction file. This updating process if performed every Friday just before the close of business. Sales of item # 12345 are stable at a rate of 5 units a day, 5 days a week. Purchases are made every 3 weeks in quantities of 75 units, and the purchased goods are received first thing Monday morning. On Friday evening, January 28th, the inventory level of item number 12345 in the warehouse was 10 units, and the balance for the item in the inventory master file was verified as being correct. The receipt of purchased goods was scheduled for the following Monday. REQUIRED: Perform a simulation for the month of February to determine the maximum discrepancy between the actual quantity of item number 12345 on hand and the balance shown in the inventory master file. Set up a table with a line for each day in the month and calculate the quantity on hand corresponding to the stated pattern of purchases and sales. Also calculate the net transaction activity used to update the inventory master file on each updating date and the resulting balance in the inventory master file.