Question
Imperial Doors produces two shower door models: Frosted23 and Frosted26. Projected sales (number of doors) for the coming five quarters are as follows: Frosted23 Frosted26
Imperial Doors produces two shower door models: Frosted23 and Frosted26. Projected sales (number of doors) for the coming five quarters are as follows:
Frosted23 | Frosted26 | |
First quarter, 2020 | 950 | 1200 |
Second quarter,2020 | 1800 | 2300 |
Third quarter, 2020 | 2400 | 3250 |
Fourth quarter,2020 | 3100 | 3500 |
First quarter, 2021 | 1010 | 1480 |
The vice-president of sales believes that the projected sales are realistic and can be achieved by the company. Imperial Doors needs a production budget for each product. Beginning inventory of Frosted23 for the first quarter of 2020 was 220 doors. The companys policy is to have 20 percent of the next quarters sales of Frosted23 in ending inventory. Beginning inventory of Frosted26 was 170 doors. The companys policy is to have 10 percent of the next quarters sales of Frosted26 in ending inventory.
Required: Prepare a production budget for each quarter for 2020 and for the year in total.
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