Parwin Corporation plans to sell 41,000 units during August. If the company has
ID: 2553037 • Letter: P
Question
Parwin Corporation plans to sell 41,000 units during August. If the company has 17,000 units on hand at the start of the month, and plans to have 18,000 units on hand at the end of the month, how many units must be produced during the month?
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Sarafiny Corporation is in the process of preparing its annual budget. The following beginning and ending inventory levels are planned for the year.
Each unit of finished goods requires 2 grams of raw material. The company plans to sell 560,000 units during the year.
The number of units the company would have to manufacture during the year would be:
Beginning Inventory Ending Inventory Finished goods (units) 21,000 71,000 Raw material (grams) 51,000 41,000Explanation / Answer
Units that must be produced during the month by Parwin Corporation:
= Units sold + Ending Inventory - Beginning Inventory
= 41,000 + 18,000 - 17,000
= 42,000 units
The number of units the company (Sarafiny Corporation) would have to manufacture during the year would be:
Units produced = Units sold + Ending Inventory - Beginning Inventory
= 560,000 + 71,000 - 51,000
= 610,000 units