ooo T-Mobile LTE @ : 48%.D+ 5:15 PM ezto.mheducation.com 0.71 points Electro Com
ID: 2416518 • Letter: O
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ooo T-Mobile LTE @ : 48%.D+ 5:15 PM ezto.mheducation.com 0.71 points Electro Company manufactures an innovative automobile transmission for electric cars. Management predicts that ending finished goods inventory for the first quarter will be 75,000 units. The following unit sales of the transmissions are expected during the rest of the year: second quarter, 450,000 units; third quarter 525,000 units; and fourth quarter, 475,000 units. Company policy calls for the ending finished goods inventory of a quarter to equal 20% of the next quarter's budgeted sales. (Ending inventory for the first quarter does not comply with company policy.) Prepare a production budget for both the second and third quarters that shows the number of transmissions to manufacture Production Budget Second and Third Quarters Second Quarter Third Quarter Required units of available production Units to be produced Hints References eBook & Resources Hint#1Explanation / Answer
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The production budget for the 2nd and 3rd quarter is as under: Electro Company Manufacture Production Budget For the 2nd and 3rd Qtrs. 2nd Qtr 3rd Qtr Budgeted sales 450,000 525,000 Budgeted ending inventory 105,000 95,000 Total units needed 555,000 620,000 Less: Begining inventory (75,000) (105,000) Budgeted units to produce 480,000 515,000 Budgeted ending inventory for 2nd qtr is 20% of budgeted sales of 3rd qtr. Ending inventory of 2nd qtr Budgeted sales of 3rd qtr 525,000 Ending inventory @20% of budgeted sales of 3rd qtr 105,000 Budgeted ending inventory for 3rd qtr is 20% of budgeted sales of 4th qtr. Ending inventory of 3rd qtr Budgeted sales of 4th qtr 475,000 Ending inventory @20% of budgeted sales of 4th qtr 95,000Related Questions
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