Question

Betz Company's sales budget shows the following projections for next year:

Sales in Units: 1st Quarter = 60,000; 2nd Quarter = 80,000; 3rd Quarter = 45,000; 4th Quarter = 55,000
Inventory at the beginning of the year was 18,000 units. The finished goods inventory at the end of each quarter is to equal 30% of the next quarter's budgeted unit sales. How many units should be produced during the first quarter?
a) 24,000
b) 48,000
c) 66,000
d) 72,000

Answer 1

c) 66,000

Step-by-step explanation:

Calculation for How many units should be produced during the first quarte

Using this formula

Amount of Units produced = Ending inventory + Units sold + Beginning inventory

Let plug in the formula

Amount of Units produced= (30% × 80,000) + 60,000 − 18,000

Amount of Units produced= 24,000 + 60,000 − 18,000

Amount of Units produced=$66,000

Therefore the units that should be produced during the first quarter will be $66,000