Dolce Co. estimates its sales at 180,000 units in the first quarter and that sales will increase by 18,000 units each quarter over the year. They have, and desire, a 25% ending inventory of finished goods. Each unit sells for $25. 40% of the sales are for cash. 70% of the credit customers pay within the quarter. The remainder is received in the quarter following sale. Production in units for the third quarter should be budgeted at
a. 274,500.
b. 207,000.
c. 216,000.
d. 220,500.

Production for Quarter 3 = $220500

so correct option is 220,500

Explanation:

given data

estimate sale 1st quarter = 180,000 units

sale increase = 18,000 units each quarter

ending inventory  = 25%

solution

we get here Quarter 2 Sales that is get as

Quarter 2 sale = 180000 + 18000

Quarter 2 sale = 198000  units

and

now we get Quarter 3 Sales that will be as

Quarter 3 Sales = 198000 + 18000

Quarter 3 Sales = 216000  units

so now  Production for Quarter 3  is as

Production for Quarter 3 = Sales + Closing Inventory - Opening Inventory (1)

put here value and we get

Production for Quarter 3 = 216000 + 25% of  216000 - 25 % of 198000

Production for Quarter 3  = 216,000 + 54,000 - 49,500

Production for Quarter 3 = $220500

so correct option is 220,500

answer; be sure that the information on file is correct;

answer; private store;