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Indigo Industries has budgeted the following unit sales: 2022 Units January 10.000 February 7,000 March 9.500 April 11,000 May 15.000 The finished goods units on
Indigo Industries has budgeted the following unit sales: 2022 Units January 10.000 February 7,000 March 9.500 April 11,000 May 15.000 The finished goods units on hand on December 31, 2021 was 2,000 units. Each unit of finished goods requires 2 pounds of direct materials that are estimated to cost an average of $5 per pound. It is the company's policy to maintain a finished goods inventory at the end of each month equal to 20% of next month's anticipated sales. The company also has a policy of maintaining a direct materials inventory at the end of each month equal to 30% of the pounds needed for the following month's production. There were 5,640 pounds of direct materials on hand at December 31, 2021. (a) a Your answer has been saved. See score details after the due date, . . For the first quarter of 2022. prepare a production budget. INDIGOINDUSTRIES Production Budget January February Expected unit sales 10000 7000 Desired ending finished goods inventory 1400 1900 Total required finished goods units 11400 8900 Less : Beginning finished goods inventory 2000 1400 Required production of finished goods units 9400 7500 + Attempts: 1 of 1 used (b) For the first quarter of 2022, prepare a direct materials budget. INDIGOINDUSTRIES Direct Materials Budget January February
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