The amount of money allocated for purchasing or replacing inventory to meet sales goals is known as?

The correct choice relates to the concept of an open to buy plan, which is a financial tool used in retailing to manage inventory purchasing. This plan defines the amount of money available for purchasing new inventory over a specific period based on sales forecasts and existing inventory levels. It helps retailers ensure that they have enough stock to meet customer demand without overstocking, which can tie up capital and increase holding costs.

By tracking what's sold, what’s on hand, and what’s needed to achieve sales objectives, retailers can make informed decisions about how much new inventory to buy. The open to buy plan is essential for maintaining a balance between sales goals and inventory levels, ultimately aiding in maximizing profitability.

In contrast, the other options refer to different financial strategies or concepts that do not specifically pertain to the allocation of funds for inventory purchases. The net sales budget outlines expected revenue from sales but does not explicitly focus on inventory acquisition. An inventory management strategy involves broader tactics for managing stock but does not directly specify the monetary framework for purchases. Lastly, cash flow projection looks at the inflow and outflow of cash within a business, which is more general and does not specifically address the purchasing aspect of inventory.