Question

Jannusch Corporation makes one product. Budgeted unit sales for July, August, September, and October are 10,000, 11,600, 13,300, and 12,700 units, respectively. The ending finished goods inventory should equal 20% of the following month's sales. The budgeted required production for August is closest to:

(a) 11,600 units

(b) 11,940 units

(c) 14,260 units

(d) 16,580 units

Answer 1

Answer:

Option A is Correct one.

The budgeted required production for August is 11,600 units.

Explanation:

Beginning inventory=(20%*11600)=2320

Add:production(balance)(11600+2660-2320)=11940 units(B).

Less:ending inventory(20%*13300)=(2660)

Sales=11600 units