2. Bodin Company budgets on an annual basis. The following beginning and ending inventory levels (in units) are planned for the year 20x1. Two units of raw material are required to produce each unit of finished product. December 31 Raw material Work in process Finished goods January 1 44,000 16,000 92,000 47,000 16,000 70,000 Required: 1. If Bodin Company plans to sell 464,000 units during the year, compute the number of units the firm would have to manufacture during the year. 2. If 507,000 finished units were to be manufactured by Bodin Company during the year, determine the amount of raw material to be purchased.
2. Bodin Company budgets on an annual basis. The following beginning and ending inventory levels (in units) are planned for the year 20x1. Two units of raw material are required to produce each unit of finished product. December 31 Raw material Work in process Finished goods January 1 44,000 16,000 92,000 47,000 16,000 70,000 Required: 1. If Bodin Company plans to sell 464,000 units during the year, compute the number of units the firm would have to manufacture during the year. 2. If 507,000 finished units were to be manufactured by Bodin Company during the year, determine the amount of raw material to be purchased.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Transcribed Image Text:2. Bodin Company budgets on an annual basis. The following beginning and ending inventory levels (in units) are planned
for the year 20x1. Two units of raw material are required to produce each unit of finished product.
December
31
Raw
material
Work in
process
Finished
goods
January
1
44,000
16,000
92,000
47,000
16,000
70,000
Required:
1.
If Bodin Company plans to sell 464,000 units during the year, compute the number of units the firm would have to
manufacture during the year.
2. If 507,000 finished units were to be manufactured by Bodin Company during the year, determine the amount of raw
material to be purchased.
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