A company has a target of increasing the sales by 20% more for the next year. With the reduction in the cost of materials used, the profit margin is expected to be higher. Which of the following conclusions can definitely be drawn from this?
1
The inventory of finished goods in the company will increase disproportionately.
2
The company's sales will increase, but its profitability will be affected.
3
The company is expected to post higher sales and profit next year.
4
Units sold will increase, but total sales revenue will decrease.