On January 1, 2023, the Kingbird Company budget committee reached agreement on the following data for the six months ending June 30, 2023: 1. 2. 3. Sales units: First quarter 4,900; second quarter 6.000; third quarter 6,900 Ending raw materials inventory: 40% of the next quarter's production requirements Ending finished goods inventory: 25% of the next quarter's expected sales units Third-quarter production: 7,100 units The ending raw materials and finished goods inventories at December 31, 2022, had the same percentages for production and sales that are budgeted for 2022.3 kilograms of raw materials are needed to make each unit of finished goods. Raw materials purchased am expected to cost $4 per kilogram.
On January 1, 2023, the Kingbird Company budget committee reached agreement on the following data for the six months ending June 30, 2023: 1. 2. 3. Sales units: First quarter 4,900; second quarter 6.000; third quarter 6,900 Ending raw materials inventory: 40% of the next quarter's production requirements Ending finished goods inventory: 25% of the next quarter's expected sales units Third-quarter production: 7,100 units The ending raw materials and finished goods inventories at December 31, 2022, had the same percentages for production and sales that are budgeted for 2022.3 kilograms of raw materials are needed to make each unit of finished goods. Raw materials purchased am expected to cost $4 per kilogram.
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:On January 1, 2023, the Kingbird Company budget committee reached agreement on the following data for the six months ending
June 30, 2023:
Sales units: First quarter 4,900; second quarter 6,000; third quarter 6,900
Ending raw materials inventory: 40% of the next quarter's production requirements
Ending finished goods inventory: 25% of the next quarter's expected sales units
4. Third-quarter production: 7,100 units
1.
2.
3.
The ending raw materials and finished goods inventories at December 31, 2022, had the same percentages for production and sales
that are budgeted for 2022. 3 kilograms of raw materials are needed to make each unit of finished goods. Raw materials purchased are
expected to cost $4 per kilogram.
Prepare a production budget by quarters for the six-month period ended June 30, 2023.
KINGBIRD COMPANY
Production Budget
For the Six Months Ending June 30, 2023
Quarter
Expected unit sales
✓
v
Y
1
Prepare a direct materials budget by quarters for the six-month period ended June 30, 2023.
KINGBIRD COMPANY
Direct Materials Budget
For the Six Months Ending June 30, 2023
Quarter
1
2
2
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