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Franklin Products Limited manufactures and distributes a number of products to retailers. One of these products, SuperStick, requires five kilograms of material D236 in the
Franklin Products Limited manufactures and distributes a number of products to retailers. One of these products, SuperStick, requires five kilograms of material D236 in the manufacture of each unit. The company is now planning raw materials needs for the third quarter-July, August, and September. Peak sales of SuperStick occur in the third quarter of each year. To keep production and shipments moving smoothly, the company has the following inventory requirements: a. The finished goods inventory on hand at the end of each month must be equal to 8,550 units plus 20% of the next month's sales. The finished goods inventory on June 30 is budgeted to be 22,660 units. b. The raw materials inventory on hand at the end of each month must be equal to 40% of the following month's production needs for raw materials. The raw materials inventory on June 30 for material D236 is budgeted to be 131,200 kilograms. c. The company maintains no work in process inventories. A sales budget for SuperStick for the last six months of the year follows: July August September October November December Budgeted Sales in Units 61,100 75,550 106, 100 53,550 30,550 15, 220 Required: 1. Prepare a production budget for SuperStick for July, August, September, and October. July August September October Budgeted sales (units) Total needs 0 0 0 Required production 0 0 0 0
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