Lavender Corporation manufactures Product X. Each unit of X requires 2 ounces of sweet syrup. To insure
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Lavender Corporation manufactures Product X. Each unit of X requires 2 ounces of ‘sweet syrup’. To insure sufficient quantities of sweet syrup on hand, Lavender requires an ending inventory of sweet syrup each month equal to 30% of the following month’s needs. Beginning sweet syrup inventory on January 1st is 50,000 ounces and Lavender’s budgeted production of Product X for the first quarter of the year is:
- January 50,000 units of X
- February 90,000 units of X
- March 30,000 units of X
Lavender’s budgeted materials purchases (in ounces) for the month of January is closest to:
104,000 ounces of sweet syrup
77,000 ounces of sweet syrup
100,000 ounces of sweet syrup
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