If the expected sales volume for the current period is 7,500 units, the desired ending inventory is 263 units, and the beginning inventory is 343 units, the number of units set forth in the production budget, representing total production for the current period, is

Question

Alice Guerrero

Business

25 July, 18:02

If the expected sales volume for the current period is 7,500 units, the desired ending inventory is 263 units, and the beginning inventory is 343 units, the number of units set forth in the production budget, representing total production for the current period, is

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Answers (1)

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Ruth Archer · Answer 1

Total production for the current period is expected to be 7420 units.

Explanation:

The current production should be enough to meet the required units needed for the desired ending inventory and the units needed to meet the current sales after adjusting for the opening inventory of units that is available. Thu, s the current production requirement will be,

Production = Closing Inventory + Sales - Opening Inventory

Production = 263 + 7500 - 343

Production = 7420 units