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Kentucky Inc. Manufactures Soccer balls. The estimated number of soccer balls sold for the first three...

Kentucky Inc. Manufactures Soccer balls. The estimated number of soccer balls sold for the first three months of 2018 are as follows: Month: Sales: June 2,000 July 3,000 August 4,000 The Actual finished goods inventory at the end of May 2018 was 2,000 units. Ending Finished Goods inventory is planned to equal 25% of the next month's sales. Kentucky incorporated will sell the soccer balls for $5.00 each. Septemberl 2018 Sales are projected at 8,500 soccer balls. How many Soccer balls should Kentucky Inc. budget to be produced in July? August? Looking to understand! Not just for the answer

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Expert Solution

Units to be produced = Expected Sales + Ending Inventory - Beginning Inventory

June Jul
Expected Sales in units                       2,000                      3,000
Expected Ending Inventory                           750 [3000 x 25%]                      1,000 [4000 x 25%]
    Total units needed                       2,750                      4,000
Less: Beginning Inventory                       2,000 [given may's end inventory]                         750
    Units to be produced                           750 = Answer                      3,250 = Answer

ekkarill92 answered 1 year ago
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