Tsao Company budgets on an annual basis. The following beginning and ending inventory levels (in units) are planned for the year 20x1. Three units of raw material are required to produce each unit of finished product.
Required:
A. If Tsao Company plans to sell 380,000 units during the year, compute the number of units the firm would have to manufacture during the year.
B. If 400,000 finished units were to be manufactured by Tsao Company during the year, determine the amount of raw material to be purchased.

Question

Tsao Company budgets on an annual basis. The following beginning and ending inventory levels (in units) are planned for the year 20x1. Three units of raw material are required to produce each unit of finished product.
Required: 
A. If Tsao Company plans to sell 380,000 units during the year, compute the number of units the firm would have to manufacture during the year.
B. If 400,000 finished units were to be manufactured by Tsao Company during the year, determine the amount of raw material to be purchased.

Quizplus · Accepted Answer

The Answer of Tsao Company budgets on an annual basis. The following beginning and ending inventory levels (in units) are planned for the year 20x1. Three units of raw material are required to produce each unit of finished product.
Required: 
A. If Tsao Company plans to sell 380,000 units during the year, compute the number of units the firm would have to manufacture during the year.
B. If 400,000 finished units were to be manufactured by Tsao Company during the year, determine the amount of raw material to be purchased.

Tsao Company Budgets on an Annual Basis