US CMA Part 1 · Chapter 2 · Question 12 of 30
Budgeted sales for the next quarter are 24,000 units. Finished goods inventory at the start of the quarter is 3,000 units and management wants 4,500 units on hand at the end. How many units should be produced?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) 25,500 units
Explanation
Required production = budgeted sales + desired ending inventory - beginning inventory = 24,000 + 4,500 - 3,000 = 25,500 units.
More Planning, Budgeting and Forecasting MCQs
- Q14A company plans to produce 25,500 units next quarter. Each unit requires 0.75 direct labor hours, and the wage rate is $28 per hour. What…
- Q15Credit sales are budgeted at $200,000 in January, $240,000 in February and $260,000 in March. Collections follow this pattern: 30% in the…
- Q16A retailer pays for 40% of its merchandise purchases in the month of purchase and the remaining 60% in the following month. Purchases are…
- Q17A company's cash budget for April shows a beginning cash balance of $35,000, cash receipts of $238,000 and cash disbursements of $251,000…
- Q18A static budget prepared for 10,000 units shows total variable costs of $180,000 and fixed costs of $95,000. Actual output was 11,500…