Question

The company has 4,300 units of product on hand at July 1. 10% of the next month's sales in units should be on hand at the end of each month. October sales are expected to be 73,000 units. Budgeted sales for September would be (in units):

Answer 1

Answer:

Budgeted sales for September in unit is 56,500 units.

Explanation:

Note: This question is not complete. See the attached pdf file for the complete question.

August beginning inventory = August sales in unit * 10% = 53,500 * 10% = 5,350

September ending inventory = October expected sales in unit * 10% = 73,000 * 10% = 7,300

September beginning inventory = August ending inventory = August production in unit - August sales in unit + August beginning inventory = 53,800 - 53,500 + 5,350 = 5,650

Therefore, we have:

Budgeted sales for September in unit = September production in unit + September beginning inventory - September ending inventory = 58,150 + 5,650 - 7,300 = 56,500