The following are the sales forecast of Avril Furniture Company for the upcoming fiscalyear:Year 2Year 3Quarter 110,000Quarter 315,000Quarter 2Quarter 423,000Quarter 130,000Budgeted unit salesPast experience has shown that the ending inventory for each quarter should be equal to10% of the next quarter's sales in units. The company expect to start the first quarter with4,000 units.Two pounds of material A are required for each unit produced. The company has a policyof maintaining a stock of material A on hand at the end of each quarter equal to 25% of thenext quarter's production needs for material A. Fourth quarter ending of materials isestimated as 8,000 pounds and a total of 12,000 pounds of material A are on hand to startthe year. The cost of material A is $3 per pound.Required:a. Prepare a production budget showing the number of units to be produced each quarterand for the year in totak proď th.b. Prepare Avril's Direct Material Budget and calculate direct materials dollar amount ofpurchases by quarter and for the year in total16,000

Budgets are the estimated amount that is based on future sales, it helps in analyzing the current…

Answered: The following are the sales forecast of…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Please solve all requiremetns
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