Kesselring Corporation makes one product and has provided the following information to help prepare the master budget for the next three months of operations: The ending finished goods inventory should equal 40% of the following month's sales. The budgeted finished goods inventory balance at the end of August is closest to:

Question

Kesselring Corporation makes one product and has provided the following information to help prepare the master budget for the next three months of operations:   The ending finished goods inventory should equal 40% of the following month's sales. The budgeted finished goods inventory balance at the end of August is closest to:

Quizplus · Accepted Answer

The estimated unit product cost is computed as follows:
 11eacbfc_c5da_5aa0_8ffe_df250b88c8d4_TB7552_00 The estimated finished goods inventory balance at the end of August is computed as follows:
 11eacbfc_c5da_81b1_8ffe_2d3396c28e3b_TB7552_00 *September sales of 12,200 units × 40% = 4,880 units

Kesselring Corporation Makes One Product and Has Provided the Following