Answer:
Results are below.
Explanation:
Giving the following information:
Sales in Units
April 70,000
May 85,000
June 110,000
July 90,000
Desired ending inventory= 15% of the following month’s sales.
The inventory at the end of March was 10,500 units.
<u>To calculate the production required for each month, we need to use the following formula:</u>
Production= sales + desired ending inventory - beginning inventory
<u>April:</u>
Sales= 70,000
Desired ending inventory= 85,000*0.15= 12,750
Beginning inventory= (10,500)
Total production= 72,250
<u>May:</u>
Sales= 85,000
Desired ending inventory= 110,000*0.15= 16,500
Beginning inventory= (12,750)
Total production= 88,750
<u>June:</u>
Sales= 110,000
Desired ending inventory= 90,000*0.15= 13,500
Beginning inventory= (16,500)
Total production= 107,000
Total quarter= 268,000
