Kentucky Energy (fka QMIN)

[kojak79]

RE:The point was:
It will cost money to create Inventory.
QMNM has no money to create Inventory.

As of today, there is only one (1) Purchase Order calling for a maximum of 10,000 tons per month.
Which means QMNM can produce 10,000 tons per month and the revenue generated from the sale of the 10,000 tons will cover the 10,000 tons operating costs, with profits being paid to creditors.

QMNM can not use the profits of the 10,000 tons to produce Inventory because profits are earmarked to be paid to creditors; not to be used to pay for the Inventory.



A point to remember: mining coal is not quite the same as producing widgets in a factory.

Geological conditions can and will change, thus affecting productivity. The prudent thing to do is to mine as much coal as possible to the point of even stockpiling it, if necessary. There may come a time when they can use day 3's overproduction to cover days 6&7 underproduction. This is not meant to be a reflection on the work force. They have to mine the coal in the conditions they're dealt.

Most generally, if there is surplus coal on the ground, it can be sold.