What Is the Ending Inventory Level for April in the Production

question 24

Multiple Choice

What is the ending inventory level for April in the production plan shown in the table? All entries in the table are in terms of sales units. $$\begin{array} { | l | c | c | c | c | } \hline { \text { Month } } & \text { Forecast } & \begin{array} { c } \text { Regular } \\\text { Production }\end{array} & \begin{array} { c } \text { Overtime } \\\text { Production }\end{array} & \begin{array} { c } \text { Ending } \\\text { Inventory }\end{array} \\\hline \text { Tanuary } & 250 & 250 & 0 & 0 \\\hline \text { February } & 200 & 300 & 0 & \\\hline \text { March } & 300 & 325 & 25 & \\\hline \text { April } & 500 & 400 & 25 & \\\hline\end{array}$$

• A)150 units
• B)125 units
• C)100 units
• D)75 units

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Definitions:

Perpetual Inventory System

An inventory accounting technique that immediately logs the sale or acquisition of inventory using computerized point-of-sale systems and enterprise asset management software.

Cost of Goods Sold

Cost of Goods Sold is the direct costs attributable to the production of the goods sold by a company, including material and labor costs.

Quantity Discount

A price reduction offered to buyers purchasing in large volumes or amounts.

Inventory

Materials or goods a business holds for the purpose of resale or production, representing a current asset on the balance sheet.