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Inventory Control Manager

Real-Life Activities

Real-Life Math

Managing inventory is a math-intensive career path. While computer software programs do much of the work today, math skills are essential.

You manage inventory for an Internet bookseller. Your job is to keep the inventory stocked within a certain range. You are also responsible for keeping the tax bill for the inventory at a minimum.

Taxes are assessed based on a once-a-year snapshot of inventory. For that reason, many companies try to reduce inventory before the end of the year.

You have been asked to keep the tax bill for your company's inventory under $1.2 million. It's now early November. Your tax bill will be assessed based on the value of books in stock as of Dec. 31. That's eight weeks away.

The current inventory of books is valued at $22 million and the tax rate for inventory is 12 percent. How much do you need to reduce the inventory by in order to meet the $1.2 million cap?

You also want to reduce inventory by a consistent amount each week leading up to the inventory tax date. What is the weekly value of books you want to sell?