Question

Pasadena Candle Inc. projected sales of 800,000 candles for January. The estimated January 1 inventory is 35,000 units, and the desired January 31 inventory is 20,000 units. What is the budgeted production (in units) for January?

Answer 1

Answer:

785,000

Explanation:

Calculation to determine the budgeted production (in units) for January

BUDGETED PRODUCTION (in units) FOR JANUARY

Expected units to be sold 800000

Add Desired ending inventory, Dec 31 20000

Total units available 820000

(800,000+20,000)

Less Estimated beginning inventory, Jan 1 (35000)

Total units to be produced 785000

(820,000-35,000)

Therefore the budgeted production (in units) for January is 785,000