The number of units included in the production budget:
A)are always the same as the number of units in the sales budget.
B)depends on the direct materials purchases budget.
C)is based on the number of units in the sales budget,and increased for increases in the selling and administrative expense budget to account for increased demand.
D)may differ from the number of units in the sales budget,depending on ending inventory goals.

Question

Quizplus · Accepted Answer

The number of units included in the production budget may be different from the number of units in the sales budget if the company has specific ending inventory goals. This is because the production budget must consider the desired level of ending inventory along with the expected sales and beginning inventory.

The Number of Units Included in the Production Budget