Ask Question
19 October, 22:46

Atlas Company plans to sell 145,000 units in November and 190,000 units in December. Atlas's policy is that 15% of the following month's sales must be in ending inventory. On November 1, there were 21,750 units in inventory. It takes 35 minutes of direct labor time to make one unit. Direct labor wages average $19 per hour. Variable overhead is applied at the rate of $7 per direct labor hour. Fixed overhead is budgeted at $60,500 per month. What is the budgeted production in units for November?

a. 121,000 units

b. 151,750 units

c. 100,000 units

d. 125,600 units

e. 140,000 units

+1
Answers (1)
  1. 19 October, 23:16
    0
    Option (b) is correct.

    Explanation:

    Given that,

    Sales = 145,000 units

    Desired ending inventory = 28,500 units

    Beginning inventory = 21,750

    Budgeted production in units for November:

    = Sales + desired ending inventory - Beginning inventory

    = 145,000 units + (190,000 * 15%) - 21,750

    = 145,000 units + 28,500 - 21,750

    = 151,750 units
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Atlas Company plans to sell 145,000 units in November and 190,000 units in December. Atlas's policy is that 15% of the following month's ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers