Friday, November 13, 2009

Budgeted production of widgets would be?

Fairway's April sales forecast projects that 6,000


widgets and 6,125 wackers will sell at prices of


$10.50 and $10.00, respectively. The desired ending


inventory of widgets is 30% higher than the


beginning inventory, which was 1,000 units.


Budgeted production of widgets would be:


A. 6,000 units.


B. 7,000 units.


C. 6,300 units.


D. 7,300 units.


E. Some other amount.

Budgeted production of widgets would be?
If the ending inventory is 30% greater than the beginning inventory then the ending inventory needs to be 1300.





So if the company currently has 1000 units they need to produce an additional 300 + 6000 widgets to sell during the time period so the answer is C - 6300


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