Sales in third quarter = 190000 + 19000 + 19000 units = 228000
Add:- Desired Ending inventory ( 228000 * 25 % ) = 57000
Units required = 285000
Less:- Opening inventory ( 190000 + 19000 units ) * 25 % = 52250
Production = 232750
Option B is correct.
Bonita Industries estimates its sales at 190000 units in the first quarter and that sales will...
Bonita Industries estimates its sales at 160,000 units in the first quarter and that sales will increase by 27,000 units each quarter over the year. They have, and desire, a 25% ending inventory of finished goods. Each unit sells for $25. 40% of the sales are for cash. 70% of the credit customers pay within the quarter. The remainder is received in the quarter following sale. Cash collections for the third quarter are budgeted at:a. $2,981,500.b. $4,387,000.c. $5,228,500.d. $6,613,938.
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