Question
In: Accounting
A company is preparing the production budget
A company is preparing the production budget for the second quarter Projected sales (in units) are as follows:
• April 600 Units
• May 680 units
• June 750 units
The company policy decided at the start of the period on 1 April to have an ending finished goods stocks of 20% of the next month's projected sales. Assuming that there was no opening stock for April, what should be the production quota for May?
Select one:
O a. 680 units O b. 666 units O c. 830 units O d. 694 units O e. 750 units.
---
The following is the forecast level of inventory (in units) for Aardvark Ltd:
| - | Opening Closing | |
|---|---|---|
| Work in process | 10,000 | 25,000 |
| Finished goods | 20,000 | 15,000 |
If the company plans to sell 320,000 units, how many will they need to produce during the period?
Solutions
Expert Solution
7.
| May | ||
| Opening stock | 136 | |
| Projected sales | 680 | |
| Desired closing stock | 150 | [750*20%] |
| Ending stock | 694 | [680+150-136] |
Option d, 694 units
8. Option , 315000 [ 320,000 - 20,000+ 15000]
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