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What is the maximum inventory level the firm can carry

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Epsom Co. manufactures furniture and sells about $40 million a year at a gross margins of 45%

a. What is the maximum inventory level the firm can carry to maintain an inventory turnover (based on COGS) of 8.0?

b. if the inventory contains $1.2 million of obsolete and damaged goods that don't turn over at all, how fast would the active inventory have to turn over to achieve an overall turnover rate of $8.00?

Reference no: EM13944604

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