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Production Budget and Direct Materials Purchases Budgets

Peanut Land Inc. produces all-natural organic peanut butter. The peanut butter is sold in 12-ounce jars. The sales budget for the first four months of the year is as follows:

	Unit Sales	Dollar Sales ($)
January	80,000	176,000
February	50,000	110,000
March	70,000	154,000
April	58,000	127,600

Company policy requires that ending inventories for each month be 20% of next month's sales. At the beginning of January, the inventory of peanut butter is 32,000 jars. Each jar of peanut butter needs two raw materials: 24 ounces of peanuts and one jar. Company policy requires that ending inventories of raw materials for each month be 20% of the next month's production needs. That policy was met on January 1.

Required:

1. Prepare a production budget for the first quarter of the year. Show the number of jars that should be produced each month as well as for the quarter in total.

Peanut Land Inc.
Production Budget
For the First Quarter of the Year
	January	February	March	Total
Sales	fill in the blank 0a66bdf71fd9f8a_1	fill in the blank 0a66bdf71fd9f8a_2	fill in the blank 0a66bdf71fd9f8a_3	fill in the blank 0a66bdf71fd9f8a_4
Desired ending inventory	fill in the blank 0a66bdf71fd9f8a_5	fill in the blank 0a66bdf71fd9f8a_6	fill in the blank 0a66bdf71fd9f8a_7	fill in the blank 0a66bdf71fd9f8a_8
Total needs	fill in the blank 0a66bdf71fd9f8a_9	fill in the blank 0a66bdf71fd9f8a_10	fill in the blank 0a66bdf71fd9f8a_11	fill in the blank 0a66bdf71fd9f8a_12
Less: Beginning inventory	fill in the blank 0a66bdf71fd9f8a_13	fill in the blank 0a66bdf71fd9f8a_14	fill in the blank 0a66bdf71fd9f8a_15	fill in the blank 0a66bdf71fd9f8a_16
Units produced	fill in the blank 0a66bdf71fd9f8a_17	fill in the blank 0a66bdf71fd9f8a_18	fill in the blank 0a66bdf71fd9f8a_19	fill in the blank 0a66bdf71fd9f8a_20

2. Prepare a direct materials purchases budget for jars for the months of January and February.

Peanut Land Inc.
Direct Materials Purchases Budget for Jars
For January and February
	January	February	Total
Production	fill in the blank e442e4f5306bf85_1	fill in the blank e442e4f5306bf85_2	fill in the blank e442e4f5306bf85_3
Jar	fill in the blank e442e4f5306bf85_4	fill in the blank e442e4f5306bf85_5	fill in the blank e442e4f5306bf85_6
Jars for production	fill in the blank e442e4f5306bf85_7	fill in the blank e442e4f5306bf85_8	fill in the blank e442e4f5306bf85_9
Desired ending inventory	fill in the blank e442e4f5306bf85_10	fill in the blank e442e4f5306bf85_11	fill in the blank e442e4f5306bf85_12
Total needs	fill in the blank e442e4f5306bf85_13	fill in the blank e442e4f5306bf85_14	fill in the blank e442e4f5306bf85_15
Less: Beginning inventory	fill in the blank e442e4f5306bf85_16	fill in the blank e442e4f5306bf85_17	fill in the blank e442e4f5306bf85_18
Jars purchased	fill in the blank e442e4f5306bf85_19	fill in the blank e442e4f5306bf85_20	fill in the blank e442e4f5306bf85_21

Prepare a direct materials purchases budget for peanuts for the months of January and February.

Peanut Land Inc.
Direct Materials Purchases Budget for Peanuts
For January and February
	January	February	Total
Production	fill in the blank 81def9f7b01ef92_1	fill in the blank 81def9f7b01ef92_2	fill in the blank 81def9f7b01ef92_3
Ounces	fill in the blank 81def9f7b01ef92_4	fill in the blank 81def9f7b01ef92_5	fill in the blank 81def9f7b01ef92_6
Ounces for production	fill in the blank 81def9f7b01ef92_7	fill in the blank 81def9f7b01ef92_8	fill in the blank 81def9f7b01ef92_9
Desired ending inventory	fill in the blank 81def9f7b01ef92_10	fill in the blank 81def9f7b01ef92_11	fill in the blank 81def9f7b01ef92_12
Total needs	fill in the blank 81def9f7b01ef92_13	fill in the blank 81def9f7b01ef92_14	fill in the blank 81def9f7b01ef92_15
Less: Beginning inventory	fill in the blank 81def9f7b01ef92_16	fill in the blank 81def9f7b01ef92_17	fill in the blank 81def9f7b01ef92_18
Ounces purchased	fill in the blank 81def9f7b01ef92_19	fill in the blank 81def9f7b01ef92_20	fill in the blank 81def9f7b01ef92_21