On January 1, 2021, the Chinlee Company budget committee reached agreement on the following data for the six months ending June 30, 2021: 1.Sales units: First quarter 8,000; second quarter 8,800; third quarter 11,000 2. Ending raw materials inventory: 50% of the next quarter's production requirements 3. Ending finished goods inventory: 25% of the next quarter's expected sales units 4.Third-quarter production: 7,400 units The ending raw materials and finished goods inventories at December 31, 2020, had the same percentages for production and sales that are budgeted for 2020. 3 kilograms of raw materials are needed to make each unit of finished goods. Raw materials purchased are expected to cost $5 per kilogram. Prepare the production budget by quarters for the six-month period ended June 30, 2021.
On January 1, 2021, the Chinlee Company budget committee reached agreement on the following data for the six months ending June 30, 2021: 1.Sales units: First quarter 8,000; second quarter 8,800; third quarter 11,000 2. Ending raw materials inventory: 50% of the next quarter's production requirements 3. Ending finished goods inventory: 25% of the next quarter's expected sales units 4.Third-quarter production: 7,400 units The ending raw materials and finished goods inventories at December 31, 2020, had the same percentages for production and sales that are budgeted for 2020. 3 kilograms of raw materials are needed to make each unit of finished goods. Raw materials purchased are expected to cost $5 per kilogram. Prepare the production budget by quarters for the six-month period ended June 30, 2021.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
am. 151.
Transcribed Image Text:On January 1, 2021, the Chinlee Company budget committee reached agreement on the
following data for the six months ending June 30, 2021:
1.Sales units: First quarter 8,000; second quarter 8,800; third quarter 11,000
2. Ending raw materials inventory: 50% of the next quarter's production requirements
3. Ending finished goods inventory: 25% of the next quarter's expected sales
units
4.Third-quarter production: 7,400 units
The ending raw materials and finished goods inventories at December 31, 2020, had the
same percentages for production and sales that are budgeted for 2020. 3 kilograms of raw
materials are needed to make each unit of finished goods. Raw materials purchased are
expected to cost $5 per kilogram.
Prepare the production budget by quarters for the six-month period ended June 30, 2021.
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