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in 2010, Warner produced and sold 2 million bulldog trailer-hitch assemblies. the units were… 1 answer below » in 2010, Warner produced and sold 2 million bulldog trailer-hitch assemblies. the units were produced at a cost of $45 per unit and sold for $60 each. However, the cash expenses incurred for each unit only amount to $20 per unit because the firm has fixed operating costs (including depreciation and other overhead costs that total $50 million per year). The company is considering a change in its inventory management process that would reduce its average inventory balance down to 100,000 units rather than the 300,000 units it now carries. if the firm institutes the change in 2011, how will the View complete question » in 2010, Warner produced and sold 2 million bulldog trailer-hitch assemblies. the units were produced at a cost of $45 per unit and sold for $60 each. However, the cash expenses incurred for each unit only amount to $20 per unit because the firm has fixed operating costs (including depreciation and other overhead costs that total $50 million per year). The company is considering a change in its inventory management process that would reduce its average inventory balance down to 100,000 units rather than the 300,000 units it now carries. if the firm institutes the change in 2011, how will the firm’s earnings be affected, assuming that the firm simply reduces its production next year by the 200,000-unit reduction in ending inventory? How will the firm’s cash flow be impacted by the change in inventory policy? View less » Sep 18 2015 10:58 AM
