Parwin Corporation plans to sell 39,000 units during August. If the company has 16,000 units on hand at the start of the month, and plans to have 17,000 units on hand at the end of the month, how many units must be produced during the month?

A. 40,000

B. 38,000

C. 56,000

D. 55,000

A. 40,000

Explanation:

Data provided

Sold units = 39,000

Beginning units = 16,000

Ending units = 17,000

The computation of units is shown below:-

Production units = Sale unit + Desired ending inventory - Beginning inventory

= 39,000 + 17,000 - 16,000

= 56,000 - 16,000

= 40,000

So, for computing the production sales we simply applied the above formula.