Question

Lazy Days’ budgeted sales data includes Month Sales in units May 2,100 June 1,900 July 2,000...

Lazy Days’ budgeted sales data includes Month Sales in units May 2,100 June 1,900 July 2,000 The company always keeps 15% of the next month’s sales as ending inventory. How many units should Lazy Days produce during June? Group of answer choices

1,885

1,915

1,615

2,300

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Answer #1

Answer:

Lazy Days' should produce 1915 units during the June.

Working Note:

First we will calculate ending inventory of each month as per available data.

May

June

July

Sales in Units

2,100

1,900

2,000

Ending Inventory of each month in Units
(15% of next month sales)

285

(1900*15%)

300

(2000*15%)

Calculation of Units Produce in June

Sales of June (in Units)

1,900

Add: Ending Inventory of June (in Units)

300

Less: Ending Inventory of May (in Units)

(285)

Units Produce in June

1,915
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