Pletcher company produces and sells automobiles batteries, the heavy-duty HD - 2
ID: 2350261 • Letter: P
Question
Pletcher company produces and sells automobiles batteries, the heavy-duty HD - 240. The 2011 sales budget is as follows.Quater: HD-240
1 5200
2 6650
3 7860
4 11210
The January 1, 2011 inventory of HD-240 is 2290 units. Management desires an ending inventory each quarter equal to 40% of the next quarter's sales. Sales in the first quarter of 2012 are expected to be 30% higher than sales in the same quarter in 2011.
Prepare quarterly production budgets for each quarter and in total for 2011. (Enter all amounts as positive numbers and subtract where necessary. )
It starts out like this.
1- 2- 3- 4- Year
5200 6650 7860 11210
add:
Total required units
less:
Required production units:
Explanation / Answer
PLETCHER COMPANY
Production budget
For 2011
Particulars
Quarter1
Quarter2
Quarter 3
Quarter 4
Total
Required production untis
5,570
7,134
9,200
9,430
31,334
PLETCHER COMPANY
Production budget
For 2011
Particulars
Quarter1
Quarter2
Quarter 3
Quarter 4
Total
Expected unit sales 5,200 6,650 7,860 11,210 30,920 Add: Desired ending inventory 2,660 3,144 4,484 2,704 12,992 (40% of next quarter's sales) Total required units 7,860 9,794 12,344 13,914 43,912 Less: Beginning finished goods 2,290 2,660 3,144 4,484 12,578Required production untis
5,570
7,134
9,200
9,430
31,334