Crest Products expects the following sales of its single product: Units September October November December January Required: Crest has an ending finished goods Inventory policy of 30% of the next month's sales needs. September 1 Inventory is projected to be 5,700 units Each finished unit requires 2 units of Component X and 3 units of Component Z August 1 materials inventory includes 4,000 units of Component X and 156,000 units of Component Z. Crest desires to maintain a Component X Inventory equal to 10% of next month's production needs and a Component Z inventory equal to 20% of next month's production needs. a. Prepare a production budget for Crest for the quarter ending December 31 20,300 23,000 15,100 20,800 26,300 Crest Products Production Budget For the Quarter Ending December 31 October November Budgeted unit sales Plus Ending finished goods inventory Less Beginning finished goods inventory Budgeted production (units) December Total

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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B7

Crest Products expects the following sales of its single product:
September
October
Units
20,300
23,000
November
December
January
Required:
Crest has an ending finished goods Inventory policy of 30% of the next month's sales needs. September 1 Inventory is projected to be
5,700 units Each finished unit requires 2 units of Component X and 3 units of Component Z. August 1 materials inventory includes
4,000 units of Component X and 156,000 units of Component z. Crest desires to maintain a Component X inventory equal to 10% of
next month's production needs and a Component z inventory equal to 20% of next month's production needs.
a. Prepare a production budget for Crest for the quarter ending December 31
15,100
20,800
26,300
Crest Products
Production Budget
For the Quarter Ending December 31
October
November
Budgeted unit sales
Plus Ending finished goods inventory
Less Beginning finished goods inventory
Budgeted production (units)
December
Total
Transcribed Image Text:Crest Products expects the following sales of its single product: September October Units 20,300 23,000 November December January Required: Crest has an ending finished goods Inventory policy of 30% of the next month's sales needs. September 1 Inventory is projected to be 5,700 units Each finished unit requires 2 units of Component X and 3 units of Component Z. August 1 materials inventory includes 4,000 units of Component X and 156,000 units of Component z. Crest desires to maintain a Component X inventory equal to 10% of next month's production needs and a Component z inventory equal to 20% of next month's production needs. a. Prepare a production budget for Crest for the quarter ending December 31 15,100 20,800 26,300 Crest Products Production Budget For the Quarter Ending December 31 October November Budgeted unit sales Plus Ending finished goods inventory Less Beginning finished goods inventory Budgeted production (units) December Total
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