Terrific Toys Company manufactures and sells children's skateboards. Each skateboard requires four bearings. For September, Terrific Toys Company has budgeted skateboard sales of 540 skateboards, while 600 skateboards are scheduled to be produced. Terrific Toys Company will begin September with 200 bearings in its beginning inventory, and estimates ending inventory for September to be 440 bearings.
How many bearings should Terrific Toys Company purchase in September?

A) 2640 B) 2400 C) 2600 D) 340

The purchases of bearings for September are 2640 bearings. Thus, option A is the correct answer.

Explanation:

To meet the production requirement of skateboards for September, the company needs 2400 bearings.

1 skateboard = 4 bearings required

600 skateboards = 4*600 = 2400 bearings required

The Purchases for the month can be determined as follows,

Purchases = Production + Closing Inventory - Opening Inventory

Purchases = 2400 + 440 - 200 = 2640 bearings

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