Production Budget

Assume that Stillwater Designs produces two automotive subwoofers: S$12$L$7$ and S$12$L$5.$ The S$12$L$7$ sells for $$475,$ and the S$12$L$5$ sells for $$300.$ Projected sales $($number of speakers$)$ for the coming five quarters are as follows:

Line Item Description S$12$L$7$ S$12$L$5$

First quarter, $20$Y$11,1601,885$

Second quarter, $20$Y$13,1902,030$

Third quarter, $20$Y$18,1207,685$

Fourth quarter, $20$Y$16,6705,655$

First quarter, $20$Y$21,3051,740$

The vice president of sales believes that the projected sales are realistic and can be achieved by the company.

Stillwater Designs needs a production budget for each product $($representing the amount that must be outsourced to outside manufacturers$).$ Beginning inventory of S$12$L$7$ for the first quarter of $20$Y$1$ was $340$ boxes. The company's policy is to have $20\%$ of the next quarter's sales of S$12$L$7$ in ending inventory. Beginning inventory of S$12$L$5$ was $170$ boxes. The company's policy is to have $30\%$ of the next quarter's sales of S$12$L$5$ in ending inventory.

Required:

Question Content Area

Prepare a production budget for each quarter for $20$Y$1$ and for the year in total.

Stillwater Designs

Production Budget for S$12$L$7$

For the Year Ended December $31,20$Y$1$

Line Item Description $1$st Qtr$.2$nd Qtr$.3$rd Qtr$.4$th Qtr$.$ Year

Sales Sales Sales Sales Sales Sales

Desired ending inventory Desired ending inventory Desired ending inventory Desired ending inventory Desired ending inventory Desired ending inventory

Total needs Total needs Total needs Total needs Total needs Total needs

Less: Beginning inventory Less: Beginning inventory Less: Beginning inventory Less: Beginning inventory Less: Beginning inventory Less: Beginning inventory

Units produced Units produced Units produced Units produced Units produced Units produced

Question Content Area

Prepare a production budget for each quarter for $20$Y$1$ and for the year in total. If required, round your answers to nearest whole value.

Stillwater Designs

Production Budget for S$12$L$5$

For the Year Ended December $31,20$Y$1$

Line Item Description $1$st Qtr$.2$nd Qtr$.3$rd Qtr$.4$th Qtr$.$ Year

Sales Sales Sales Sales Sales Sales

Desired ending inventory Desired ending inventory Desired ending inventory Desired ending inventory Desired ending inventory Desired ending inventory

Total needs Total needs Total needs Total needs Total needs Total needs

Less: Beginning inventory Less: Beginning inventory Less: Beginning inventory Less: Beginning inventory Less: Beginning inventory Less: Beginning inventory

Units produced Units produced Units produced Units produced Units produced Units produced