Paradise Corporation budgets on an annual basis for its fiscal year. The followi
ID: 2483717 • Letter: P
Question
Paradise Corporation budgets on an annual basis for its fiscal year. The following beginning and ending inventory levels (in units) are planned for next year.
*Three pounds of raw material are needed to produce each unit of finished product.
If Paradise Corporation plans to sell 575,000 units during next year, the number of units it would have to manufacture during the year would be:
516,000 units
575,000 units
605,000 units
545,000 units
Please explain
Beginning Inventory Ending Inventory Raw material* 59,000 69,000 Finished goods 99,000 69,000Explanation / Answer
manufacturing units during the year= total units sale + ending finished goods -begining finished goods
manufacturing units during the year = 575000 + 69000 - 99000 = 545000
so answer is
545000 units
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