Flack Corporation provides the following information for its December budgeting process: The November 30 inventory was 1,800 units.
Budgeted sales for December are 4,000 units.
Desired December 31 inventory is 2,840 units.
Budgeted purchases are:
A)5,040 units.
B)1,240 units.
C)6,840 units.
D)4,000 units.
E)5,800 units.

Question

Quizplus · Accepted Answer

To calculate the budgeted purchases, use the formula: Budgeted Purchases = Budgeted Sales + Desired Ending Inventory - Beginning Inventory. Thus, 4,000 (sales) + 2,840 (desired ending inventory) - 1,800 (beginning inventory) = 5,040 units.

Flack Corporation Provides the Following Information for Its December Budgeting