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Down Under Products, Ltd., of Australia has budgeted sales of its popular boomerang for the next four months as follows: Sales in Units 58,000 75,000
Down Under Products, Ltd., of Australia has budgeted sales of its popular boomerang for the next four months as follows: Sales in Units 58,000 75,000 98,000 84,000 April May June July The company is now in the process of preparing a production budget for the second quarter. Past experience has shown that end-of-month inventory levels must equal 15% of the following month's sales. The inventory at the end of March was 8,700 units. Required: Prepare a production budget for the second quarter; in your budget, show the number of units to be produced each month and for the quarter in total. X Answer is complete but not entirely correct. Down Under Products, Ltd., Production Budget April May June Quarter Budgeted units sales Add: Desired units of ending finished goods inventory 75,000 231,000 58,000 98,000 11,250 14,700 12,600 Total needs 69,250 89,700 110,600 231,000 Less: Units of beginning finished goods inventory 8,700 11,250 14,700 60,550 78,450 95,900 231,000 Required production in units
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