Thurston Products Thurston Products Sells a Popular Style of Running

question 26

Multiple Choice

Thurston Products Thurston Products sells a popular style of running shoe. The company has prepared the following sales forecast for the second quarter of 2012:
Ending inventory at March 31, 2012 was budgeted at 7,500 pairs. Management would like the desired quantity of finished goods inventory at the end of each month to be equal to 15 percent of next month's budgeted unit sales. July's sales are projected to be 135,000 pairs.
Each completed unit of finished product requires 2 pounds of rubber material at a cost of $1.75 per pound. The company has determined that it needs 20 percent of next month's raw material needs on hand at the end of each month.
Refer to the Thurston Products information above. The total required production of running shoes for the second quarter of 2012 is:

• A) 315,000 pairs
• B) 327,750 pairs
• C) 302,250 pairs
• D) 287,250 pairs

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