Question

# Nearing Company has provided the following information: Budgeted unit sales: January 420,000 February 400,000 March 430,000...

Nearing Company has provided the following information:

Budgeted unit sales:

 January 420,000 February 400,000 March 430,000 April 450,000

Nearing Company plans on maintaining ending inventory levels equal to 40% of the following month's unit sales.

Fill in the amounts for the quarter ending March 31, 2018:

1) Budgeted unit sales

2) Desired units of ending finished goods inventory

3) Total needs

4) Units of beginning finished goods inventory

5) Required production in units

1. Table showing budgeted sales in units

 Month Unit January 420,000 February 400,000 March 430,000 Total 1,250,000

2. Desired unit if ending goods inventory =450,000*40%= 180,000 units.

3. Total needs= closing stock+ sale units

= 180,000+ 1,250,000=1,430,000 units.

4. Units in the beginning of finished goods inventory

= 420,000*40%=168,000 units.

5. Required Production in units

= Closing stock+ sales- opening stock

= 180,000+1,250,000-168,000

=1,262,000units

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