Answer:
24,000 units
Explanation:
Given:
Budgeted sales for January = 30,000
Budgeted sales for February = 20,000
Opening inventory in January = 7,500
Desired ending inventory = 20% of sales in February
                                         = 0.2 × 20,000
                                         = 4,000 units
Units required in January = 30,000 + 4,000
                                         = 34,000 units
Units to be produced in January = 34,000 - opening inventory
                                                    = 34,000 - 7,500
                                                    = 26,500 units
Budgeted sales for February = 20,000
Budgeted sales for March = 40,000
Opening inventory in February is closing inventory of January = 4,000
Desired ending inventory = 20% of sales in March
                                         = 0.2 × 40,000
                                         = 8,000 units
Units required in February = 20,000 + 8,000
                                         = 28,000 units
Units to be produced in February = 28,000 - opening inventory
                                                          = 28,000 - 4,000
                                                          = 24,000 units