Exercise 21-4

Turney Company produces and sells automobile batteries, the heavy-duty HD-240. The 2014 sales forecast is as follows.

Quarter	HD-240
1	5,000
2	7,000
3	8,000
4	10,000

The January 1, 2014, inventory of HD-240 is2,000units. Management desires an ending inventory each quarter equal to 40% of the next quarters sales. Sales in the first quarter of 2015 are expected to be 25% higher than sales in the same quarter in 2014.

Prepare quarterly production budgets for each quarter and in total for 2014.

TURNEY COMPANY Production Budget For the Year Ending December 31, 2014
Product HD-240
Quarter
1	2	3	4	Year
Beginning Finished Goods UnitBeginning Direct MaterialsDesired Ending Direct MaterialsDesired Ending Finished Goods UnitDirect Materials Per UnitDirect Materials PurchasesExpected Unit SalesRequired Production UnitsTotal Materials RequiredTotal Required Units
AddLess: Beginning Finished Goods UnitBeginning Direct MaterialsDesired Ending Direct MaterialsDesired Ending Finished Goods UnitDirect Materials Per UnitDirect Materials PurchasesExpected Unit SalesRequired Production UnitsTotal Materials RequiredTotal Required Units
Beginning Finished Goods UnitBeginning Direct MaterialsDesired Ending Direct MaterialsDesired Ending Finished Goods UnitDirect Materials Per UnitDirect Materials PurchasesExpected Unit SalesRequired Production UnitsTotal Materials RequiredTotal Required Units
AddLess: Beginning Finished Goods UnitBeginning Direct MaterialsDesired Ending Direct MaterialsDesired Ending Finished Goods UnitDirect Materials Per UnitDirect Materials PurchasesExpected Unit SalesRequired Production UnitsTotal Materials RequiredTotal Required Units
Beginning Finished Goods UnitBeginning Direct MaterialsDesired Ending Direct MaterialsDesired Ending Finished Goods UnitDirect Materials Per UnitDirect Materials PurchasesExpected Unit SalesRequired Production UnitsTotal Materials RequiredTotal Required Units