Question

Bear, Inc. estimates its sales at 200,000 units in the first quarter and that sales will increase by 20,000 units each quarter over the year. They have, and desire, a 25% ending inventory of finished goods. Each unit sells for $35.40% of the sales are for cash. 70% of the credit customers pay within the quarter. The remainder is received in the quarter following sale.
1. Production in units for the third quarter should be budgeted at _________.

Answer 1

Answer:

Production in third quarter should be budgeted at $245000

Explanation:

10) Production in third quarter = Sales unit+Desired ending inventory-Beginning inventory

= 240000+(260000*25%)-(240000*25%)

Production in third quarter = 245000 Units

so answer is 245000