Ask Question
28 September, 15:46

Dolce Co. estimates its sales at 180,000 units in the first quarter and that sales will increase by 18,000 units each quarter over the year. They have, and desire, a 25% ending inventory of finished goods. Each unit sells for $25. 40% of the sales are for cash. 70% of the credit customers pay within the quarter. The remainder is received in the quarter following sale. Production in units for the third quarter should be budgeted at

274,500.

207,000.

216,000.

220,500.

+5
Answers (1)
  1. 28 September, 19:17
    0
    correct option is 220,500

    Explanation:

    given data

    sales = 180,000 units

    sales increase = 18,000 units each quarter

    ending inventory = 25%

    solution

    we know here that Quarter 2 Sales is

    Quarter 2 = 180000 + 18000 = 198000 units

    and

    Quarter 3 Sales will be

    Quarter 3 Sales = 198000 + 18000 = 216000 units

    so that Production for Quarter 3 will be here as

    Production for Quarter 3 = Sales + Closing Inventory - Opening Inventory ... 1

    put here value

    Production for Quarter 3 = 216000 + 25% of 216000 - 25 % of 198000

    Production for Quarter 3 = 216,000 + 54,000 - 49,500

    Production for Quarter 3 = $220500

    so correct option is 220,500
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Dolce Co. estimates its sales at 180,000 units in the first quarter and that sales will increase by 18,000 units each quarter over the ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers