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sladkih [1.3K]
3 years ago
7

Totz Company produces jump ropes. Totz Company has the following sales projections for the upcoming​ year:First quarter budgeted

jump rope sales in units​17,000Second quarter budgeted jump rope sales in units​20,000Third quarter budgeted jump rope sales in units​20,000Fourth quarter budgeted jump rope sales in units​25,000Inventory at the beginning of the year was​ 4,500 jump ropes. Totz Company wants to have​ 20% of the next​ quarter's sales in units on hand at the end of each quarter. How many jump ropes should Totz Company produce during the first​ quarter?
Business
1 answer:
LenKa [72]3 years ago
8 0

Answer:

Production budget for First quarter= 16,500 units

Explanation:

<em>The production budgeted for a particular period is the expected units to be produced after adjusting the sales budget figures for opening and closing inventories. </em>

Production = Sales volume + closing inventory - opening inventory

Closing inventory = 20% × second quarter sales

                           = 20% × 20,000 = 4,000 units

<em />

<em>Production budget for the first quarter</em>

=17,000 + 4000 -4500

= 16,500 units

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