Question

Andrews Corp. ended the year carrying $100,338,000 worth of inventory. Had they sold their entire inventory at their current prices, how many more dollars of contribution margin would it have brought to Andrews Corp.?

Answer 1

Answer:

$100338000.

Explanation:

Given: Inventory carrying= $100338000.

As entire inventory is been sold at current price, then revenue of the company will increase by $100338000, therefore contribution margin will also increase further by $10033800 for the Andrew corp.

∴ Contribution margin= $100338000.

Inventory carrying cost are the cost of holding inventory for a period of time until it is sold. it include warehousing cost, cost for keeping inventory safe, etc.