Question

Joslyn Company manufactures metal brackets. The estimated number of metal bracket sales for the first three months of the current year is: Month Unit Sales January 1,250 February 1,400 March 1,200 Finished goods inventory at the end of last December was 300 units. Desired ending finished goods inventory is equal to 20 percent of the next month's sales. Joslyn Company expects to sell the brackets for $20 each. How many brackets should Joslyn produce in February?

Answer 1

Answer:

Production= 1,240 units

Explanation:

Giving the following information:

Sales:

February= 1,250

March= 1,200

Desired ending finished goods inventory is equal to 20 percent of the next month's sales.

To determine the production required for February, we need to use the following formula:

Production= sales + desired ending inventory - beginning inventory

Production= 1,250 + (1,200*0.2) - (1,250*0.2)

Production= 1,240 units