Use the information below to answer the following questions.
Patiomaster Products manufactures patio furniture. The estimated numbers of sets to be sold for the last three months of 2015 is:
$\begin{array}{lr}\text { Month}&\text { Sales }\
\text { October } & 10,000 \
\text { November } & 7,000 \
\text { December } & 5,000 \
\text { Tanuary } & 6,000
\end{array}$ Finished goods inventory at the end of September is 2,000 units. Finished goods inventory is set at 20 percent of next month's sales.
-Refer to the table above.How many sets of patio furniture will be produced in December 2015?

Question

Use the information below to answer the following questions.
Patiomaster Products manufactures patio furniture. The estimated numbers of sets to be sold for the last three months of 2015 is:
 $\begin{array}{lr}\text { Month}&\text {  Sales }\
\text { October } & 10,000 \
\text { November } & 7,000 \
\text { December } & 5,000 \
\text { Tanuary } & 6,000
\end{array}$ Finished goods inventory at the end of September is 2,000 units. Finished goods inventory is set at 20 percent of next month's sales.
-Refer to the table above.How many sets of patio furniture will be produced in December 2015?

Quizplus · Accepted Answer

To calculate the production for December, we need to ensure that the ending inventory for December is 20% of January's sales (6,000 units), which is 1,200 units. The beginning inventory for December is 20% of December's sales (5,000 units), which is 1,000 units. Therefore, the production for December is: December sales (5,000) + ending inventory (1,200) - beginning inventory (1,000) = 5,200 units.

Use the Information Below to Answer the Following Questions Finished Goods Inventory at the End of September Is 2,000