In a production budget, if the number of units in finished goods inventory at the end...

In a production budget, if the number of units in finished goods inventory at the end of the period is less than the number o

In a production budget, if the number of units in finished goods inventory at the end of the period is less than the number of units in finished goods inventory at the beginning of the period, then the expected number of units sold is less than the number of units to be produced during the period.

Expert Solution

Answer

The statement is FALSE.
If ending units of inventory are LESS than the no. of beginning units of Inventory, it means that no. of units sold are MORE than [not less than] number of units produced during that period.
Example:

		Case #1	Case #2
A	Beginning units	10,000	11,000
B	Units Produced	15,000	17,000
C	Units Sold [more than units produced]	17,000	18,000
D = A+B-C	Ending Units [less than beginning units]	8,000	10,000

ekkarill92 answered 2 years ago

When there are no units in the beginning Finished Goods Inventory and the units produced are...

When there are no units in the beginning Finished Goods Inventory and the units produced are more than the units sold, the operating income will be higher under variable costing than absorption costing.

16. Assume that June’s production budget showed required production of 438,000 units, desired ending finished goods...

16. Assume that June’s production budget showed required production of 438,000 units, desired ending finished goods inventory of 29,000 units, and beginning finished goods inventory 12,500 units. What were June’s budgeted unit sales? Multiple Choice 454,500 units 421,500 units 472,250 units 414,250 units 18. Assume the following information: Amount Per Unit Sales $ 600,000 $ 40 Contribution margin $ 360,000 $ 24 Net operating income $ 240,000 If the selling price per unit increases by 10% and unit sales drop...

If finished goods inventory increases between the beginning and the end of the year, then the...

If finished goods inventory increases between the beginning and the end of the year, then the cost of goods sold is smaller than the cost of goods manufactured. true or false

Dido Co.’s finished goods inventory policy is to hold enough inventory at the end of the...

Dido Co.’s finished goods inventory policy is to hold enough inventory at the end of the month to meet 22% of next month’s sales requirements. The cost and selling price of each unit of inventory is $19 and $29, respectively. Dido’s budgeted sales (in units) for the months June through September 20x1 is as follows: June 7510 July 5064 August 9826 September 2192 What is Dido’s budgeted production (in dollars) for the month of August 20x1? Select one: a. $8147...

1.The finished goods beginning inventory = $100,000; The finished goods ending inventory = $50,000; The work...

1.The finished goods beginning inventory = $100,000; The finished goods ending inventory = $50,000; The work in process inventory at the beginning of the year was $150,000 and at the end of the year $50,000; The raw materials inventory at the beginning of the year $80,000 and at the end of the year was $40,000. Manufacturing costs and selling and administrative expenses were as follows: indirect materials = $10,000; factory utilities = $20,000; raw material purchases = $30,000 in June...

Wiley’s electronics has a policy of maintaining a finished goods inventory balance at the end of...

Wiley’s electronics has a policy of maintaining a finished goods inventory balance at the end of a month equal to 30% of the budgeted sales requirements of the following month. The ending inventory balance on 30 January was 840 units, and the projected unit sales for February, March, and April were 4,800, 5,200, and 5,400 units respectively. The labor requirements per unit produced are as follows: Particulars Time required (hours) Rate per hour Machining 1.8 $23 Sorting 0.9 $18 Assembly...

The ending finished goods budget is generally prepared before the: Multiple Choice Production Budget. Budgeted Balance...

The ending finished goods budget is generally prepared before the: Multiple Choice Production Budget. Budgeted Balance Sheet. Manufacturing Overhead Budget. Sales Budget.

Gorberchev Food Processing expects to have 20,000 units of finished goods inventory on hand on March...

Gorberchev Food Processing expects to have 20,000 units of finished goods inventory on hand on March 31 and reports the following expected sales (in units) for the months of April through July: April 120,000 May 130,000 June 140,000 July 120,000 At the end of each month the company desires its ending finished goods inventory to be 20% of the next month's projected sales (in units). The budgeted production (in units) for Gorberchev Food Processing for May should be: Multiple Choice...

Q1: The Cardinal Company had a finished goods inventory of 55,000 units on January 1. Its...

Q1: The Cardinal Company had a finished goods inventory of 55,000 units on January 1. Its projected sales for the next four months were: January - 200,000 units; February - 180,000 units; March - 210,000 units; and April - 230,000 units. The Cardinal Company wishes to maintain a desired ending finished goods inventory of 20% of the following month’s sales. What is the budgeted units of production for January? a.200,000 b.181,000 c.219,000 d.236,000 Q2: The Cardinal Company had a finished...

Greenlands, Inc. began the year with three units of finished goods inventory that cost $6 each...

Greenlands, Inc. began the year with three units of finished goods inventory that cost $6 each to manufacture. Greenlands also established a $6 per unit standard product cost for the upcoming accounting period. The company actually incurred unit costs of $4 for direct materials, $2 for direct labor, and $1 for factory overhead for the ten units it produced in the current period. Greenlands sold 11 units at $10 each during the accounting period. The firm accounted for inventory on...

Question