The following information relstes to a company that produces a single product. Esch unit requires four pounds of material. Inventory requirements are as follows: a. The finished goods inventory on hand at the end of each month must be equal to 8,000 units plus 28% of the next month's sales. The finished goods inventory on December 31 is budgeted based on this requirement. b.The raw materials inventory on hand at the end of esch month must be equal to one- half of the following month's production needs for rew materials. The row materials inventory on December 31 is budgeted based on this requirement. c. The company maintains no work in process inventories. A sales budget for the company for the first and second quarters of the upcoming year follows. Budgeted Sales in Units 43,000 53,000 73,000 38,000 23,000 13,000 January February Morch April May June Required: 1. Prepare a production budget for the upcoming year for the months of January. February, March and April. Production Budget January February March April Budgeted sales Total needs Required production 3. Prepare a direct materials budget showing the quantity of material to be purchased for January, February, March and for the quarter in total.

The following information relstes to a company that produces a single product. Esch unit requires four pounds of material. Inventory requirements are as follows: a. The finished goods inventory on hand at the end of each month must be equal to 8,000 units plus 28% of the next month's sales. The finished goods inventory on December 31 is budgeted based on this requirement. b.The raw materials inventory on hand at the end of esch month must be equal to one- half of the following month's production needs for rew materials. The row materials inventory on December 31 is budgeted based on this requirement. c. The company maintains no work in process inventories. A sales budget for the company for the first and second quarters of the upcoming year follows. Budgeted Sales in Units 43,000 53,000 73,000 38,000 23,000 13,000 January February Morch April May June Required: 1. Prepare a production budget for the upcoming year for the months of January. February, March and April. Production Budget January February March April Budgeted sales Total needs Required production 3. Prepare a direct materials budget showing the quantity of material to be purchased for January, February, March and for the quarter in total.

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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