Terrence Corporation plans to sell 35,000 units of its single product in March. The company has 2,200 units in its March 1 finished-goods inventory and anticipates having 1,800 completed units in inventory on March 31. On the basis of this information, how many units does Terrence plan to produce during March

Question

Business

Madalyn Pace

22 October, 17:29

Terrence Corporation plans to sell 35,000 units of its single product in March. The company has 2,200 units in its March 1 finished-goods inventory and anticipates having 1,800 completed units in inventory on March 31. On the basis of this information, how many units does Terrence plan to produce during March

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Answers (1)

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Keenan Mueller · Answer 1

Budgeted production in units = 34,600 units.

Explanation:

Budgeted production in units = Budgeted sales + Ending finished goods inventory - Beginning finished goods inventory

Given,

Budgeted sales = 35,000 units

Ending finished goods inventory = 1,800 units

Beginning finished goods inventory = 2,200 units

Putting the values into the formula, we can get

Budgeted production in units = Budgeted sales + Ending finished goods inventory - Beginning finished goods inventory

or, Budgeted production = 35,000 + 1,800 - 2,200

or, Budgeted production = 36,800 - 2,200

or, Budgeted production = 34,600 units.