Poplar company has budgeted production for next year as follows: Quarter...


Poplar company has budgeted production for next year as follows:

First Second Third Fourth
Units to be sold 53,400 80,200 92,000 ?

At the beginning of the year, Poplar is expected to have 2,670 units of the product. At the end of each quarter, Poplar would like to have an inventory equal to 5% of the sales units of the next quarter.

How many units should Poplar produce in the second quarter?

A. 54,740 units

B. 79,610 units

C. 80,220 units

D. 80,790 units

E. None of the above.

Production Budget:

The production budget shows the required units required to be produced in a given period. It starts with the units required to be sold, which is added by ending inventory units and deducted by beginning inventory units. The resulting units are the units required to be produced.

Answer and Explanation: 1

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The units that Poplar should produce in the second quarter is calculated by adding the ending inventory to the sales required per quarter and...

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Production Budget: Preparation & Examples


Chapter 11 / Lesson 5

Learn about the production budget and understand how it is used. Explore what is included in a production budget and study a production budget example.

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