Budgeted production is calculated by: Multiple Choice

adding budgeted unit sales to budgeted beginning

finished goods inventory, and subtracting budgeted

ending finished goods

inventory.

Budgeted Production is obtained by adding Sales to the desired finished goods inventory and subtracting beginning finished goods inventory. We move opposite to get to the budgeted production.

For example if we have $ 300,000 sales and desired ending inventory is $ 50,000 and finished good beginning inventory is $ 25,000 so the budgeted production would be

Budgeted Production = Sales + Desired Ending Inventory - Beginning Inventory

Budgeted Production = $ 300,000 + $ 50,000 - $ 25,000 = $ 325,000