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Kentucky Inc. Manufactures Soccer balls. The estimated number of soccer balls sold for the first three...

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Accounting

Kentucky Inc. Manufactures Soccer balls. The estimated number ofsoccer balls sold for the first three months of 2018 are asfollows: Month: Sales: June 2,000 July 3,000 August 4,000 TheActual finished goods inventory at the end of May 2018 was 2,000units. Ending Finished Goods inventory is planned to equal 25% ofthe next month's sales. Kentucky incorporated will sell the soccerballs for $5.00 each. Septemberl 2018 Sales are projected at 8,500soccer balls. How many Soccer balls should Kentucky Inc. budget tobe produced in July? August? Looking to understand! Not just forthe answer

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4.3 Ratings (707 Votes)

Units to be produced = Expected Sales + Ending Inventory - Beginning Inventory

June Jul
Expected Sales in units                       2,000                      3,000
Expected Ending Inventory                           750 [3000 x 25%]                      1,000 [4000 x 25%]
    Total units needed                       2,750                      4,000
Less: Beginning Inventory                       2,000 [given may's end inventory]                         750
    Units to be produced                           750 = Answer                      3,250 = Answer

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