Cameroon Corp manufactures and selil etric staplers for 1620

Cameroon Corp manufactures and selil etric staplers for $16.20 each. #1,000 ntswre sold m December, and management forecasts 4.2% growth in sales each month, the number of electric stapler sales budgeted for March should be: O 10000 11.314 O 10420 10,858 O o20

Solution

The Correct Answer is 11,314

Cameroon Corp. sold 10,000 units of electric staplers in December.

Sales will grow @4.2% each month which means that Sales budgeted for the month of January would be

Sales of December * (1 + g)

10,000 units * (1 + g)

where g is the growth rate

10,000 units * (1 + 4.2%)

10,000 units * (1 + 0.042)

10,000 units * 1.042

10,420 units

Sales budgeted for the month of February

Sales of January * 1.042

10,420 units * 1.042

10,857.64

Sales budgeted for the month of March

10,857.64 * 1.042

11,314 units (rounded off)