Question
Modesto Company purchases Product Alpha from a supplier for resale. The company's controller has just completed the purchases budget for the first four months of
Modesto Company purchases Product Alpha from a supplier for resale. The company's controller has just completed the purchases budget for the first four months of next year as shown below.
| January | February | March | April | |
| Budgeted unit sales | 30,000 | 40,000 | 60,000 | 50,000 |
| Desired Ending Inventory | 8,000 | 12,000 | 10,000 | 4,000 |
| Units Required | 38,000 | 52,000 | 70,000 | 54,000 |
| Beginning Inventory | 6,000 | 8,000 | 12,000 | 10,000 |
| Budgeted Purchases | 32,000 | 44,000 | 58,000 | 44,000 |
The company's supplier can provide a maximum of 50,000 units per month. What actions, if any, should Modesto take based on the budget information presented?
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Educational Foundations
Authors: Leslie Kaplan, James D Stice, William Owings
2nd Edition
1285968298, 9781285968292
