Answer:
(A) c. $464,000
(B) c. 20,400 units
(C) d. 22,500 units
Explanation:
a. The computation of the total budgeted sales of both products is shown below:
= Product A sales units × selling price per unit + Product B sales units × selling price per unit
= 20,000 units × $10 + 22,000 units × $12
= $200,000 + $264,000
= $464,000
b. For computing the budgeted purchase, first we need to find out the ending inventory which is shown below:
Ending inventory = Beginning inventory + (Beginning inventory × increase rate)
= 2,000 units + 2,000 units × 20%
= 2,000 units + 400 units
= 2,400 units
Now the budgeted production would be equal to
= Foretasted sales + ending inventory - Beginning inventory
= 20,000 units + 2,400 - 2,000 units
= 20,400 units
(C) The computation of the budgeted production is shown below:
= Foretasted sales + ending inventory - Beginning inventory
= 22,000 units + 3,000 - 2,500 units
= 22,500 units
