Pearl Products Limited of Shenzhen, China, manufactures and distributes toys thr

Question

Pearl Products Limited of Shenzhen, China, manufactures and distributes toys throughout South East Asia. Two cubic centimeters (cc) of solvent H300 are required to manufacture each unit of Supermix, one of the company's products. The company is now planning raw materials needs for the third quarter, the quarter in which peak sales of Supermix occur. To keep production and sales moving smoothly, the company has the following inventory requirements:

The finished goods inventory on hand at the end of each month must be equal to 10,000 units of Supermix plus 31% of the next month's sales. The finished goods inventory on June 30 is budgeted to be 21,780 units.

The raw materials inventory on hand at the end of each month must be equal to one-half of the following month's production needs for raw materials. The raw materials inventory on June 30 is budgeted to be 41,100 cc of solvent H300.

Prepare a production budget for Supermix for the months July, August, September, and October. (Input all amounts as positive values.)

   

   

   

   

   

   

   

   

Pearl Products Limited of Shenzhen, China, manufactures and distributes toys throughout South East Asia. Two cubic centimeters (cc) of solvent H300 are required to manufacture each unit of Supermix, one of the company's products. The company is now planning raw materials needs for the third quarter, the quarter in which peak sales of Supermix occur. To keep production and sales moving smoothly, the company has the following inventory requirements:

Explanation / Answer

Hi,

Please find the answer as follows:

Thanks.

July August September October Budgeted sales 38000 48000 68000 33000 Desired ending inventory 24880 31080 20230 15580 Total needs 62880 79080 88230 48580 Beginning inventory 21780 24880 31080 20230 Required production 41100 54200 57150 28350

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