... previous two years, Clarkson has had an average of 53 days for his inventory turnover. Clarkson should be able to move his purchasing into more of a just-in-time scenario. By gaining more control of his forecasting, Mr. Clarkson should be able to predict with more care, exactly how much inventory is going to be needed for the next quarter, instead of trying to buy enough to carry for the year. I think it is feasible to reduce this amount by about $500,000 for the year. If Clarkson could've done this in 1995, they would have attained a gross profit of about $1,255,000, an increase of over $200,000. Because the $200,000 note has begun to be paid, operating expenses have increased to the point of being unable to maintain a minimum amount of cash for purchases. One area of recommendation would be to reduce Mr. Clarkson's salary by $20,000 to $70,000 for ...

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