Tarheel Company produces and sells specialized portfolio cases. It expects to sell 20,000 cases next year at $75 each. There is a beginning inventory of 1,500 cases and the company wants to have an ending inventory equal to 30 percent of this year’s sales. How many cases need to be produced?

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Tarheel Company produces and sells specialized portfolio cases. It expects to sell 20,000 cases next year at $75 each. There is a beginning inventory of 1,500 cases and the company wants to have an ending inventory equal to 30 percent of this year’s sales. How many cases need to be produced?

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Answer : Production = 24500 units

working notes for the above answer isĀ  asunder

We have been provided with the information that

Tarheel Company produces expects to sell 20,000 cases next year

Selling price $75 each.

Beginning inventory of 1,500 cases

and the company wants to have an ending inventory equal to 30 percent of this year’s sales.

Beginning inventory of 1,500 cases

an ending inventory equal to 30 percent of this year’s sales

=30 % (20,000)

=6000 units

SO production

= 6000+20,000-1500

=24500 units

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