Answer (B) is correct . Sales are expected to be 402,000 units in April. The beginning inventory is 12,000 units, and the ending inventory is expected to be 10,000 units, a decline in inventory of 2,000 units. Thus, the budget should be based on production of 400,000 units (402,000 units to be sold – 12,000 units BI + 10,000 units EI).
Answer (A) is incorrect because Not considering the need to produce for ending inventory results in 390,000 units.
Answer (C) is incorrect because Sales for the month equals 402,000 units; a portion of these sales will come from the beginning inventory.
Answer (D) is incorrect because The sum of sales and beginning and ending inventories is 424,000 units.
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Superflite’s C-14 production budget for April should be based on the manufacture of
