The Waverly Company has budgeted sales for the year as follows: Quarter 1 2 3 4 Sales in units 14,000 16,000 20,000 18,000 The ending inventory of finished goods for each quarter should equal 25% of the next quarter's budgeted sales in units. The finished goods inventory at the start of the year is 5,000 units. Scheduled production for the third quarter is (in units) 19,500 units. 20,000 units. 14,000 units. 20,500 units.

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Business

Reid Suarez

17 November, 07:36

The Waverly Company has budgeted sales for the year as follows: Quarter 1 2 3 4 Sales in units 14,000 16,000 20,000 18,000 The ending inventory of finished goods for each quarter should equal 25% of the next quarter's budgeted sales in units. The finished goods inventory at the start of the year is 5,000 units. Scheduled production for the third quarter is (in units) 19,500 units. 20,000 units. 14,000 units. 20,500 units.

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Sullivan Villarreal · Answer 1

Production for the third quarter 20,500

Explanation:

Third quarter production

sales for the period 20,000

desired ending inventory

25% of next quarter

25% of 18,000 = 4,500

Total requirement 24,500

Beginning Inventory

25% of quarter sales

25% of 20,000 = (4,000)

Production for the third quarter 20,500

The sales for the period and the desired ending invnetory are the total units we require for the quarter

Our beginning inventory, are units we already have, so it decrease our needs for the quarter production.