Jones Manufacturing
Jones Manufacturing Sells Unique Decorative Water Fountains Ending Inventory at 31 December 2009 Was Budgeted at 80

Multiple Choice

Jones Manufacturing
Jones Manufacturing sells unique decorative water fountains. The company has prepared the following forecast for the first quarter of 2010:
$$\begin{array} { l l } \text { January } & 1000 \text { units } \\\text { February } & 1400 \text { units } \\\text { March } & 2000 \text { units }\end{array}$$
Ending inventory at 31 December 2009 was budgeted at 80 units. Management would like the desired quantity of finished goods inventory at the end of each month to be equal to 10 per cent of next month’s budgeted unit sales. April’s sales are projected to be 1600 units.

Each completed unit of finished product requires 3 pounds of compounding material at a cost of $2.00 per pound. The company has determined that it needs 15 per cent of next month’s raw material needs on hand at the end of each month.
-The total required production of water fountains for the first quarter of 2009 is:

A) 4320 units
B) 4560 units
C) 4640 units
D) 4480 units