Budgeted Sales for January: 8,000 Units Budgeted Sales for February: 10,000 Units Budgeted Sales for March: 12,000 Units Beginning Finished Goods for January: 3,000 Units Pevensie Inc. plans to have ending finished goods inventory of 20% of next month's projected sales. What are the budgeted total required production units for February?

Question

Giuliana Ritter

Business

13 October, 16:33

Budgeted Sales for January: 8,000 Units Budgeted Sales for February: 10,000 Units Budgeted Sales for March: 12,000 Units Beginning Finished Goods for January: 3,000 Units Pevensie Inc. plans to have ending finished goods inventory of 20% of next month's projected sales. What are the budgeted total required production units for February?

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Answers (1)

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Escobar · Answer 1

Production = 10400 units

Explanation:

Giving the following information:

Budgeted Sales for January: 8,000 Units

Budgeted Sales for February: 10,000 Units

Budgeted Sales for March: 12,000 Units

Beginning Finished Goods for January: 3,000

Units Pevensie Inc. plans to have an ending finished goods inventory of 20% of next month's projected sales.

We will assume that the ending finished goods of January reaches 20% required for February.

February:

(+) Budgeted Sales for February = 10,000 Units

(+) Ending finished goods = 12000*0,20 = 2400 units

(-) Beginning finished goods inventory = 2000 units

Production = 10000+2400-2000 = 10400 units