Hi,
It is 7,133 units to produce.
No. of units to be manufactured = [Sales units given 6,300 + 120 units which increase in Closing stock which works out to actual acceptable finished goods ] Now, this is at 90% due to 10% inspection failure and therefore, the total manufactured units to be manufacture is ( 6420 x100 ) / 90 = 7,133units.
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Kishore Kumar Natakala
Other
BENGALURU
India
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Original Message:
Sent: 05-11-2023 08:56 AM
From: SARUN SIMON
Subject: Q & A - SECTION B.5 - BUDGETING
Q - Ming Company has budgeted sales at 6,300 units for the next fiscal year, and desires to have 590 good units on hand at the end of that year. Beginning inventory is 470 units. Ming has found from past experience that 10% of all units produced do not pass final inspection, and must therefore be destroyed. How many units should Ming plan to produce in the next fiscal year?
OPTIONS -
6,890
7062
7133
7186
My answer is 7062. Question bank says it's wrong ?
Please give me some advice.
WITH REGARDS,
SARUN PORATHUR SIMON