A retail manager is preparing a budget for the coming year and is considering the various costs of the retail store. What is the best approach for the manager to take when budgeting for the cost of the store's merchandise?
A) The total costs will stay the same as last year, but the unit cost will change with each sale.
B) The total cost of merchandise for the year and the unit cost will remain constant with each sale.
C) The total cost of merchandise for the year will depend on the amount of sales, but the unit cost of each sale will stay fairly constant.
D) The total costs will stay the same as last year, and the unit cost will remain constant with each sale.

Question

Quizplus · Accepted Answer

The cost of merchandise for the year will depend on the amount of sales, but the unit cost of each sale will stay fairly constant. This approach takes into account the potential fluctuations in sales and inventory levels, and allows for adjustments in the budget based on actual sales performance. It also ensures that the unit cost of each sale is consistent, which helps with pricing and profitability analysis.

A Retail Manager Is Preparing a Budget for the Coming