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Tire City

Tire City, Inc. is a rapidly growing retail distributor of automotive tires in the northeastern United States. The stores held adequate inventory, on hand, to service all immediate customer demand. The bulk of the company’s inventory was managed at an outside warehouse which was easily serviced by the warehouse. The orders were usually serviced with in a 24 hour period. The company was able to maintain such happy customers since they had fast service and competitive prices.
During the previous three years at Tire City, the company had experienced a compounded annual sales increase in excess of 20%. In order to properly anticipate expected growth over the next couple of years, the company was looking to expand its warehouse facilities. Due to the companies rapid growth its current warehouse is bursting at the seams causing a delay in products.
The cash flow forecast predicts that 1996 sales, $28,206, will increase to $33,847 for 1997. For every dollar of this increase,......


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Approximate Word Count: 413
Approximate Pages: 2 (250 words per double-spaced page)

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