Flack Corporation, a merchandiser, provides the following information for its December budgeting process: The November 30 inventory was 1,800 units. Budgeted sales for December are 4,000 units. Desired December 31 inventory is 2,840 units.
Budgeted purchases are:
A) 4,000 units.
B) 5,040 units.
C) 1,240 units.
D) 5,800 units.
E) 6,840 units.

Question

Quizplus · Accepted Answer

To calculate budgeted purchases, use the formula: Budgeted Purchases = Budgeted Sales + Desired Ending Inventory - Beginning Inventory. Here, it is 4,000 (sales) + 2,840 (desired ending inventory) - 1,800 (beginning inventory) = 5,040 units.

Flack Corporation, a Merchandiser, Provides the Following Information for Its