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a. The finished goods inventory on hand at the end of each month must equal 4,000 units of Supermix plus 20% of the next month's sales. The finished goods inventory on June 30 is budgeted to be 14,200 units. b. The raw materials inventory on hand at the end of each month must equal one-half of the following month's production needs for raw materials. The raw materials inventory on June 30 is budgeted to be 78,000 cc of solvent H300. C. The company maintains no work in process inventories. A monthly sales budget for Supermix for the third and fourth quarters of the year follows. July August September October November December Budgeted Unit Sales 51,000 56,000 66,000 46,000 36,000 26,000 Required: 1. Prepare a production budget for Supermix for the months July, August, September, and October. 3. Prepare a direct materials budget showing the quantity of solvent H300 to be purchased for July, August, and September, and for the quarter in total. Complete this question by entering your answers in the tabs below. Required 1 Required 3 Prepare a production budget for Supermix for the months July, August, September, and October. October August 56,000 September 66,000 17,200 Pearl Products Limited Production Budget July Budgeted unit sales 51,000 Add: Desired units of ending finished goods inventory 14,200 Total needs 65,200 Less: Units of beginning finished goods inventory 14,200 Required production in units 46,000 11,200 13,200 67,200 83,200 59,200 a. The finished goods inventory on hand at the end of each month must equal 4,000 units of Supermix plus 20% of the next month's sales. The finished goods inventory on June 30 is budgeted to be 14,200 units. b. The raw materials inventory on hand at the end of each month must equal one-half of the following month's production needs for raw materials. The raw materials inventory on June 30 is budgeted to be 78,000 cc of solvent H300. c. The company maintains no work in process inventories. A monthly sales budget for Supermix for the third and fourth quarters of the year follows. July August September October November December Budgeted Unit Sales 51,000 56,000 66,000 46,000 36,000 26,000 Required: 1. Prepare a production budget for Supermix for the months July, August, September, and October 3. Prepare a direct materials budget showing the quantity of solvent H300 to be purchased for July, August, and September, and for the quarter in total. Complete this question by entering your answers in the tabs below. Required 1 Required 3 Prepare a direct materials budget showing the quantity of solvent H300 to be purchased for July, August, and September, and for the quarter in total. Pearl Products Limited Direct Materials Budget July August September Third Quarter CC CC CC CC Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Total units of raw materials needed Units of raw materials to be purchased
