Noel Enterprises Has Budgeted Sales in Units for the Next

question 94

Multiple Choice

Noel Enterprises has budgeted sales in units for the next five months as follows:
$\begin{array} {| l | r |} \hline \text { January } & 6,800 \text { units } \\\hline \text { February } & 5,400 \text { units } \\\hline \text { March } & 7,200 \text { units } \\\hline \text { April } & 4,600 \text { units } \\\hline \text { May } & 3,800 \text { units } \\\hline\end{array}$ Past experience has shown that the ending inventory for each month must be equal to 10% of the next month's sales in units. The inventory on December 31 contained 400 units. The company needs to prepare a production budget for the second quarter of the year.


-What is the total number of units to be produced in February?

• A) 5,220 units.
• B) 5,400 units.
• C) 5,580 units.
• D) 6,120 units.

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Definitions:

Value-Based Management

A management approach that ensures corporations are run consistently on value-based principles to maximize shareholder value over time.

Relevance

The degree to which something is related or useful to the matter at hand.

Value-Based Management

A management approach focusing on creating value for shareholders and maximizing company performance.

Nonsupervisory Personnel

Employees who are not responsible for overseeing the work of others and typically focus on specific tasks or operations within an organization.