5. (2points) Ace Company has 200 units of a given product on hand at the beginni

Question

5. (2points) Ace Company has 200 units of a given product on hand at the beginning of April. One unit of the product costs $6 to manufacture. The company has the following sales budget: Month Apr 1,000 May June Sales units 1,500 1,800 The company's policy is thatt will maintain an ending Finished Good inventory (in units) to be same as 30% of the following month's sales units. Based on the information above, the balance sheet at the end of April will show a S Finished Good (product balance for 6. Use the same information given in the above question. How many units of the product should be produced in April? units

Explanation / Answer

5) $    2,700 Working: In balance Sheet, Ending inventory is shown. So, Ending inventory cost of finished goods for the month of April will be calculated as follow: Ending Inventory Units for April = May Sales unit x 30% = 1500 x 30% = 450 Cost of ending inventory for April = Ending inventory units x cost per unit = 450 x $ 6 = $       2,700 6)         1,250 units Working: Units to be produced in April is calculated as follow: Units Sale         1,000 Add:Ending Inventory            450 Units available for sale         1,450 Less:Beginning Inventory            200 Units produced         1,250

Related Questions

Navigate

• Browse (All)
• Browse 5
• Subjects

---

---

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