Question

Paradise Corporation budgets on an annual basis for its fiscal year. The following beginning and ending inventory levels (in units) are planned for next year. *Three pounds of raw material are needed to produce each unit of finished product. If Paradise Corporation plans to sell 545,000 units during next year, the number of units it would have to manufacture during the year would be:________

a) 492,000 units
b) 545,000 units
c) 575,000 units
d) 515,000 units

Answer 1

Answer: d. 515,000 units

Step-by-step explanation:

If they plan to sell 545,000 units then given those beginning and ending balances of finished goods, they will have to manufacture;

= Sales + Ending balance - Beginning balance

= 545,000 + 63,000 - 93,000

= 515,000 units