Reference: 07-09
Noel Enterprises Has Budgeted Sales in Units for the Next

Reference: 07-09
Noel Enterprises has budgeted sales in units for the next five months as follows: $$\begin{array} { | l | l | } \hline \text { January } & 6,800 \text { units } \\\hline \text { February } & 5,400 \text { units } \\\hline \text { March } & 7,200 \text { units } \\\hline \text { April } & 4,600 \text { units } \\\hline \text { May } & 3,800 \text { units } \\\hline\end{array}$$ Past experience has shown that the ending inventory for each month must be equal to 10% of the next month's sales in units. The inventory on December 31 contained 400 units. The company needs to prepare a production budget for the second quarter of the year.
-The desired ending inventory in units for March is:

A) 380.
B) 540.
C) 720.
D) 460.

Correct Answer:

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