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Quick HW problem on budgeting I seem to be confused on... At Boulder Industries, budgets...

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Accounting

Quick HW problem on budgeting I seem to be confused on...

At Boulder Industries, budgets are the responsibility of everyone. Each department collaborates in determining its expected needs, and sales personnel determine the likely sales volume. Bart Gray, one of the production managers, believes in building plenty of slack into everything, including his estimates of ending inventory of work in process. You are the accounting manager. Explain to Mr. Gray why the ending inventory figure should be extremely accurate, with as little slack as possible.

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