Next Year's Sales Forecast Shows That 20,000 Units of Product

Next year's sales forecast shows that 20,000 units of Product A and 22,000 units of Product B are going to be sold for prices of $10 and $12 per unit, respectively. The desired ending inventory of Product A is 20% higher than its beginning inventory of 2,000 units. The beginning inventory of Product B is 2,500 units. The desired ending inventory of B is 3,000 units. Budgeted purchases of Product B for the year would be:

A) 24,500 units
B) 22,500 units
C) 26,500 units
D) 23,200 units

Correct Answer:

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