XYZ Co. has forecasted June sales of 400 units and July sales of 700 units. The company maintains ending inventory equal to 125% of next month's sales. June beginning inventory reflects this policy. What is June's required production?
A) 750 units
B) 0 units
C) 775 units
D) 400 units

Question

Quizplus · Accepted Answer

+ Projected sales 400 units
+ Desired ending inventory 875 (1.25 × 700)
− Beginning inventory 500 (1.25 × 400)
Units to be produced 775

XYZ Co Has Forecasted June Sales of 400 Units and July