Question

Unicorn Corporation manufactures boxes. The estimated numbers of boxes sold for the first three months of the current year are as follows: Month Sales January 3,200 February 5,000 March 4,600 Finished goods inventory at the end of December was 800 units. Ending finished goods inventory is equal to 25% of the next month's sales. Unicorn Corporation expects to sell the boxes for $5 each. April sales are projected at 4,500 boxes. How many boxes should be produced in February

Answer 1

4,900 units

Step-by-step explanation:

The computation of boxes should be produced in February is shown below:-

Purchase = Sales + Closing stock - Opening Stock

Opening stock -= Closing stock of January

Closing stock of Jan = 5,000 × 25%

= 1,250

Closing stock of Feb = 4,600 × 25%

= 1,150

Sales = 5,000

Now, we will put the value into formula

= 5,000 + 1,150 - 1,250

= 6,150 - 1,250

= 4,900 units