Go Around Products, Ltd., of Australia, has budgeted sales of its popular boomerang for the next four months as follows: April May June July Sales in Units 50,000 60,000 80,000 70,000 The company is now in the process of preparing a production budget for the second quarter. Past experience has shown that end-of- month inventory levels must equal 10% of the following month's sales. The inventory at the end of March was 5,000 units. (Australia's currency is the Australian dollar.) Required: Prepare a production budget for the second quarter; in your budget, show the number of units to be produced each month and for the quarter in total. Total needs Go Around Products, Ltd. Production Budget April May June Quarter
Go Around Products, Ltd., of Australia, has budgeted sales of its popular boomerang for the next four months as follows: April May June July Sales in Units 50,000 60,000 80,000 70,000 The company is now in the process of preparing a production budget for the second quarter. Past experience has shown that end-of- month inventory levels must equal 10% of the following month's sales. The inventory at the end of March was 5,000 units. (Australia's currency is the Australian dollar.) Required: Prepare a production budget for the second quarter; in your budget, show the number of units to be produced each month and for the quarter in total. Total needs Go Around Products, Ltd. Production Budget April May June Quarter
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:Go Around Products, Ltd., of Australia, has budgeted sales of its popular boomerang for the next four months as follows:
April
May
June
July
Sales in Units
50,000
60,000
80,000
70,000
The company is now in the process of preparing a production budget for the second quarter. Past experience has shown that end-of-
month inventory levels must equal 10% of the following month's sales. The inventory at the end of March was 5,000 units. (Australia's
currency is the Australian dollar.)
Required:
Prepare a production budget for the second quarter; in your budget, show the number of units to be produced each month and for the
quarter in total.
Total needs
Go Around Products, Ltd.
Production Budget
April
May
June
Quarter
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