Question

XYZ Company plans to sell 11,000 units of its product in January and another 10,000 in February. The beginning balance of finished goods is 1,100 on January 1 and XYZ Company wants an ending balance on January 31 of 1,000 units. How many units of its product should XYZ Company produce during January to meet its goals?

a. 9,900
b. 10,900
c. 11,000
d. 12,000

Answer 1

10,900 units

Step-by-step explanation:

The applicable formula is the formula for calculating the cost of goods sold, COGS.

COGS = The applicable formula is the formula for calculating the cost of goods sold, COGS.

COGS = Beginning inventory + purchases - closing inventory

In this case, COGS will be 11,000 units: Beginning balance 1100 and ending balance of 1000.

11,000 = 1100 + P -1000

11,000 = 1100-1000 +P

11,000 = 100 + P

P= 11,000 -100

P= 10,900

Productions should be 10,900