Sarafiny Corporation Is in the Process of Preparing Its Annual

question 5

Multiple Choice

Sarafiny Corporation is in the process of preparing its annual budget. The following beginning and ending inventory levels are planned for the year.
Each unit of finished goods requires 7 grams of raw material. The company plans to sell 270,000 units during the year
-The number of units the company would have to manufacture during the year would be:

• A) 300,000 units
• B) 270,000 units
• C) 260,000 units
• D) 280,000 units

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Definitions:

Net Incomes

The total earnings of a company after deducting all expenses, taxes, and costs from its total revenues.

Deferred Income Tax

Deferred Income Tax is a liability on a company's balance sheet that results from income already earned and recognized for accounting purposes but not yet subject to taxation.

Fair Value

The estimated market price of an asset or liability, reflecting what a willing buyer would pay to a willing seller in an arm's length transaction.