2) Tsao Company budgets on an annual basis. The following beginning and ending i

Question

2) Tsao Company budgets on an annual basis. The following beginning and ending inventory levels (in planned for the year 20x1. Three units of raw material are required to produce each unit of finishedp Required: A. If Tsao Company plans to sell 380,000 units during the year, compute the number of units the firm have to manufacture during the year. B. If 400,000 finished units were to be manufactured by Tsao Company during the year, determine the of raw material to be purchased. January December 31 90,000 12,000 40,000 70,000 Raw material Work in process Finished goods 70,00

Explanation / Answer

a) Unit manufactured = 380000+40000-70000 = 350000 units

b) Raw material purchase = (400000*3)+90000-70000 = 1220000

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