Your task is to design a spreadsheet that provides detailed information on monthly production, inventory, lost sales, and the different cost categories and solve a linear optimization model for minimizing the total cost of meeting demand over the next year. Compare your solution with the level production strategy of producing 9,100 units each month. Interpret the Sensitivity report, and conduct an appropriate study of how the solution will be affected by changing the assumption of the lost sales costs. Summarize all your results in a report to Ms. Burke.

Powell company began the 2018 accounting period with $40,000 cash, $86,000 inventory, $60,000 common stock, and $66,000 retained earnings. during 2018, powell experienced the following events: sold merchandise costing $58,000 for $99,500 on account to prentise furniture store. delivered the goods to prentise under terms fob destination. freight costs were $900 cash. received returned goods from prentise. the goods cost powell $4,000 and were sold to prentise for $5,900. granted prentise a $3,000 allowance for damaged goods that prentise agreed to keep. collected partial payment of $81,000 cash from accounts receivable. required record the events in a statements model shown below. prepare an income statement, a balance sheet, and a statement of cash flows. why would prentise agree to keep the damaged goods?