Question

A company determined that the budgeted cost of producing a product is $30 per unit. On June 1, there were 72000 units on hand, the sales department budgeted sales of 220000 units in June, and the company desires to have 40000 units on hand on June 30. "The budgeted cost of goods sold" for June would be

Answer 1

"The budgeted cost of goods sold" for June would be $5,640,000

Step-by-step explanation:

Sales department budget for June = 220,000 units

Less-Opening balance as on 1st June = 72,000 units

Add-Closing balance as on 30th June = 40,000 units

No of unit manufactured = Sales department budget for June - Opening balance as on 1st June + Closing balance as on 30th June

= 220,000 - 72,000 + 40,000

= 188,000 units

Cost per unit = $30

Budgeted cost of manufactured = 188,000 × $30 = $5,640,000