Budgeting Production and Purchases and Just$-$In$-$Time Materials Inventory

Hancock Manufacturing, Inc. is preparing budgets for the third quarter of $2016.$ Hancock produces only one product in its factory. This product requires $5$ pounds of material B$,2$ pounds of material G$,$ and a component, K$,$ that is purchased from another manufacturer. Hancock operates on a just$-$in$-$time basis for material B$.$ As a result, Hancock maintains no inventory of material B$.$ On July $1,2016,$ the inventory of material $G$ is expected to be $3,000$ pounds and the inventory of component $K$ is expected to be $1,500$ units. Hancock wants the inventories of $G$ and $K$ at September $30,2016,$ to be $20\%$ less than the inventories at July $1,2016.$ The inventory of finished products at June $30,2016,$ is expected to be $2,000$ units; the desired inventory at September $30,2016,$ is $4,000$ units to allow a buildup for heavy sales in the fourth quarter. The sales forecast for the third quarter is $13,000$ units at $$300$ each. Budgeted purchase costs are $$10$ per pound for $B,$$$7$ per pound for $G,$ and $$40$ per component for $K.$

Do not use negative signs with any of your answers below.

a$.$ Prepare the production budget for Hancock Manufacturing, Inc., for the third quarter of $2016.$

$\backslash$table$[[\backslash$table$[[$Hancock Manufacturing, Inc.$],[$Production Budget$]]],[$For the Quarter Ended September $30,,2016$