- This topic has 3 replies, 2 voices, and was last updated 1 year ago by
.
Viewing 4 posts - 1 through 4 (of 4 total)
- Posts
Hi sir , can you help me with this question
A company manufactures and sells a single product. At the end of the manufacturing process all units are inspected and 20% are rejected and scrapped. Next year the budgeted sales are 192,000 units and the inventory of finished units will increase by 2,000 units.
What is next year’s budgeted production (in units) which will be subject to inspection?
My answer is if 192000 is 80% then total would be 240000. What is the next step ?
Although they need to have 192000 for the demand, they also need another 2000 to increase inventory. So they need to have 194000 ‘good’ units. So the production will have to be 194000 / 80%.
Viewing 4 posts - 1 through 4 (of 4 total)
- The topic ‘Budgeted productions’ is closed to new replies.