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Ruiz Company provides the following budgeted sales for the next four months. The company wants to end each month with ending finished goods inventory equal
Ruiz Company provides the following budgeted sales for the next four months. The company wants to end each month with ending finished goods inventory equal to 30% of next month's budgeted unit sales. Finished goods inventory on April 1 is 177 units. Prepare a production budget for the months of April, May, and June. Budgeted sales units April 590 Budgeted sales units Add: Desired ending inventory Next period budgeted sales units Ratio of inventory to future sales Desired ending inventory units Total required units Less: Beginning inventory units Units to produce May 670 RUIZ COMPANY Production Budget April June 620 590 670 30% July 710 May 670 620 30% June 620 710 30%
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