Projected Sales for Kenworth Inc

Projected sales for Kenworth Inc. for next year and beginning and ending inventory data are as follows:
Each unit requires 5 pounds of material which costs $3.00 per pound. The beginning inventory of raw materials is 5,000 pounds. The company wants to have 3,000 pounds of material in inventory at the end of the year. Each unit produced requires 2 hours of direct labour time, which is billed at $8 per hour.
-According to the production budget, how many units should be produced?

A) 30,000
B) 42,000
C) 46,000
D) 50,000

Correct Answer:

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