What Is the Calculation of Closing Inventory for a Finished

question 8

Multiple Choice

What is the calculation of closing inventory for a finished goods inventory budget?

• A)(opening balance plus inventories manufactured)less sales of finished goods.
• B)(opening balance plus sales of finished goods)less inventories manufactured.
• C)(opening balance plus inventories manufactured)plus cash sales of finished goods.
• D)none of the above.

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Definitions:

Surplus

A surplus refers to the amount by which the quantity supplied of a product or service exceeds the quantity demanded, often resulting in a decrease in prices.

Shortage

A market condition where the demand for a good exceeds its supply at a specific price, often leading to price increases.

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a given price in a given time period.

Shortage

A situation where the demand for a product exceeds its supply in the market.