Although only 20 units are on hand at the beginning of the year, World Company plans to sell 100 units during Year 2. Assuming the company desires an ending inventory of 10 units, it should plan to purchase 110 units. 

Answer the following statement true (T) or false (F)


False

Budgeted purchases of inventory purchases (in units) = Budgeted sales (in units) + Desired ending inventory (in units) - Beginning inventory (in units)
Budgeted purchases of inventory purchases = 100 units + 10 units - 20 units = 90 units

Business

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