PE 22-2A Production budget

LifeTyme Publishers Inc. projected sales of 190,000 diaries for 2014. The estimated January 1, 2014, inventory is 18,400 units, and the desired December 31, 2014, inventory is 20,300 units. What is the budgeted production (in units) for 2014?

Answer:

Expected units to be sold………………………………………………………………… 

190,000 

Plus desired ending inventory, December 31, 2014…………………………………   20,300 

Total…………………………………………………………………………………………… 210,300 

Less estimated beginning inventory, January 1, 2014………………………………   18,400 

Total units to be produced………………………………………………………………… 191,900