urses/1958651/quizzes/3470873/take C Arvest Central Mort Mail. ame5613epn Questi
ID: 388934 • Letter: U
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urses/1958651/quizzes/3470873/take C Arvest Central Mort Mail. ame5613epn Question 25 5 pts A company has a sales forecast for the following five months as shown in the table. If they have a beginning inventory of 225 units, what amount should be produced under a level plan in order for them to have an ending inventory of zero units at the end of the five-month period? MonthForecast January arch April May 825 600 650 550 475 595 units per month 575 units per month 580 units per month 585 units per monthExplanation / Answer
Beginning inventory = 225 units
Ending inventory = 0 units
Forecast for January = 825 units
Forecast for February = 600 units
Forecast for March = 650 units
Forecast for April = 550 units
Forecast for May = 475 units
Total units to be sold in the 5 month period = 825 + 600 + 650 + 550 + 475
= 3100
Total number of units that must be produced = Total units to be sold in the 5 month period - Beginning inventory + Ending inventory
= 3100 - 225 + 0
= 2875
Total number of units that must be produced monthly in the 5 month period = 2875 / 5
= 575 units
Hence the correct answer is option B.
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