Bonkowski Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations:
Credit sales are collected:
30% in the month of the sale
70% in the following month
Raw materials purchases are paid:
30% in the month of purchase
70% in the following month
The ending finished goods inventory should equal 30% of the following month's sales. The ending raw materials inventory should equal 10% of the following month's raw materials production needs.
-The estimated finished goods inventory balance at the end of February is closest to:

Question

Bonkowski Corporation makes one product and has provided the following information to help prepare the master budget for the next four months of operations:
   Credit sales are collected:
30% in the month of the sale
70% in the following month
Raw materials purchases are paid:
30% in the month of purchase
70% in the following month
The ending finished goods inventory should equal 30% of the following month's sales. The ending raw materials inventory should equal 10% of the following month's raw materials production needs.
-The estimated finished goods inventory balance at the end of February is closest to:

Quizplus · Accepted Answer

The estimated unit product cost is computed as follows:
 11ea7761_17c1_798f_81a5_93bfd6460793_TB2580_00 The estimated finished goods inventory balance at the end of February is computed as follows:
 11ea7761_17c1_a0a0_81a5_f569937d0726_TB2580_00 *March sales of 13,300 units × 30% = 3,990 units

Bonkowski Corporation Makes One Product and Has Provided the Following