Question

The production budget shows expected unit sales of 31000 . Beginning finished goods units are 4000 . Required production units are 32600. What are the desired ending finished goods units?

What are the desired ending finished goods units?
(A) 3,600
(B) 4,600
(C) 5,600
(D) 6,600

Answer 1

To calculate the desired ending finished goods units, add the beginning finished goods units to the required production units and subtract the expected unit sales. The correct answer is C) 5,600 units.

Step-by-step explanation:

To determine the desired ending finished goods units, we can use the following information provided:

• Expected unit sales: 31,000 units
• Beginning finished goods units: 4,000 units
• Required production units: 32,600 units

The desired ending finished goods units can be calculated by adding the beginning finished goods units to the required production units and then subtracting the expected unit sales. The equation would be as follows:

Desired Ending Finished Goods Units = Beginning Finished Goods Units + Required Production Units - Expected Unit Sales

Desired Ending Finished Goods Units = 4,000 + 32,600 - 31,000

Desired Ending Finished Goods Units = 36,600 - 31,000

Desired Ending Finished Goods Units = 5,600 units

Therefore, the correct answer is (C) 5,600 units.