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23 May, 09:55

The production budget shows expected unit sales of 32,000. Beginning finished goods units are 3,600. Required production units are 33,600. What are the desired ending finished goods units?

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  1. 23 May, 11:55
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    desired ending inventory 5,200

    Explanation:

    sales for the period 32,000

    desired ending inventory?

    Total requirement?

    Beginning Inventory (3,600)

    Required production units 33,600

    The beginning inventory are units we already have, so it decrease the required production to fulfil the total requiremets

    requirement - beginning inventory = production

    requirement - 3,600 = 33,600

    requirement = 33,600 + 3,600 = 37,200

    Then, our requirement is the sum of the sales forthe period and the desired ending inventory

    sales + desired ending inventory = required units

    32,000 + desired ending inventory = 37,200

    desired ending inventory = 37,200 - 32,000 = 5,200
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