Question
Budgeted unit sales 40,000 60,000 100,000 50,000 70,000 80,000 Selling price per unit $8 per unit Accounts receivable, beginning balance $65,000 Sales collected in the
Budgeted unit sales | 40,000 | 60,000 | 100,000 | 50,000 | 70,000 | 80,000 |
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Selling price per unit | $8 | per unit |
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Accounts receivable, beginning balance | $65,000 |
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Sales collected in the quarter sales are made | 75% |
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Sales collected in the quarter after sales are made | 25% |
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Desired ending finished goods inventory is | 30% | of the budgeted unit sales of the next quarter |
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Finished goods inventory, beginning | 12,000 | units |
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Raw materials required to produce one unit | 5 | pounds |
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Desired ending inventory of raw materials is | 10% | of the next quarter's production needs |
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Raw materials inventory, beginning | 23,000 | pounds |
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Raw material costs | $0.80 | per pound |
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Raw materials purchases are paid | 60% | in the quarter the purchases are made |
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and | 40% | in the quarter following purchase |
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Accounts payable for raw materials, beginning balance | $81,500 |
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Enter a formula into each of the cells marked with a ? below |
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Construct the production budget | Year 2 Quarter | Year 3 Quarter | ||||||||||||
1 | 2 | 3 | 4 | Year | 1 | 2 | ||||||||
Budgeted unit sales | ? | ? | ? | ? | ? | ? | ? | |||||||
Add desired finished goods inventory | ? | ? | ? | ? | ? | ? | ||||||||
Total needs | ? | ? | ? | ? | ? | ? | ||||||||
Less beginning inventory | ? | ? | ? | ? | ? | ? | ||||||||
Required production | ? | ? | ? | ? | ? | ? |
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