The following information is taken from the production budget for the first quarter: $$\begin{array} { l r }
\text { Beginning inventory in units } & 300 \
\text { Sales budgeted for the quarter } & 114,000 \
\text { Capacity in units of production facility } & 118,000
\end{array}$$ How many finished goods units should be produced during the quarter if the company desires 800 units available to start the next quarter?
A)114,500
B)113,500
C)118,500
D)114,800

Question

The following information is taken from the production budget for the first quarter: $$\begin{array} { l r } 
\text { Beginning inventory in units } & 300 \
\text { Sales budgeted for the quarter } & 114,000 \
\text { Capacity in units of production facility } & 118,000
\end{array}$$ How many finished goods units should be produced during the quarter if the company desires 800 units available to start the next quarter?
A)114,500
B)113,500
C)118,500
D)114,800

Quizplus · Accepted Answer

The company desires 800 units available to start the next quarter, so the ending inventory should be 800 units. The beginning inventory is 300 units, and the sales budgeted for the quarter are 114,000 units. Therefore, the number of finished goods units that should be produced during the quarter is 114,000 + 800 - 300 = 114,500 units.

The Following Information Is Taken from the Production Budget for the First