A company\'s data is presented below. Desired ending inventory is a consistent p

Question

A company's data is presented below. Desired ending inventory is a consistent percentage of the next quarter's sales and the previous year's 4th quarter ending inventory of 560 units meets this requirement. Compute the expected production in the 3rd Quarter of the current year.

Quarter 1: expected sales units 7,000, units produced 6,840
Quarter 2: expected sales units 5,000, units produced ?
Quarter 3: expected sales units 8,000, units produced ?
Quarter 4: expected sales units 6,000, units produced ?


7,840
8,160
8,000
8,480
7,360

Explanation / Answer

560/7000 = 8% Quarter 3: Beginning inventory = 8%*8000 = 640 Ending inventory = 8%*6000 = 480 Units produced = 8000 + 480 - 640 = 7840 Answer: 7840

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.