Question

Frolic Corporation has budgeted sales and production over the next quarter as follows: July August September Sales in units 46,500 58,500 ? Production in units 47,050 58,800 63,150 The company has 5,300 units of product on hand at July 1. 10% of the next month's sales in units should be on hand at the end of each month. October sales are expected to be 78,000 units. Budgeted sales for September would be (in units):

Answer 1

Answer:

61,500 units

Explanation:

                                                      July           August            September

budgeted sales                         46,500         58,500             61,500

budgeted production                47,050         58,800              63,150

beginning inventory                    5,300           5,850               6,150

ending inventory                         5,850           6,150                 7,800

ending inventory August = beginning inventory + budgeted production - budgeted sales = 5,850 + 58,800 - 58,500 = 6,150

units sold during September = beginning inventory + budgeted production - ending inventory = 6,150 + 63,150 - 7,800 = 61,500