Problem 4 16 points Total Prepare the Budgets given the following information Bu

Question

Problem 4 16 points Total Prepare the Budgets given the following information Budgeted sales are expected to be: Units 300 Units 400 Units 300 Units 400 Units March Selling Price O Per unit A. Prepare the sales Budget Sales Budget Budected sales in units Times selli Budgeted sells in dollars are the Production B (5 points) Desired ending invento 20% of next months Sales Assume beginning inventory for January meet 20% of the current month Sales in units Add desired ending Inv Total needs Less Beginning Inv Production in units are the materials Purchase Budget (6 points) of next month's needs in poun (assume this was met for January's beginning) Desired inven Material per unit Material cost 0 3pounds 0.50 per pound PRODUCTION in units times materials per unit in lbs Production need in lbs. Total necds Less beR. Inv Materials to be Purch Times cost Total Cost of Purchases

Explanation / Answer

ReqA: Jan Feb Mar Quarter Budgeted Sales in Units 200 300 400 900 Selling price per unit 10 10 10 10 Budgeted Sales in $ 2000 3000 4000 9000 ReqB Jan Feb Mar Quarter April May Sales units 200 300 400 900 300 400 Add: Ending Inventory 60 80 60 60 80 (20% of next month Sales) (300*20%) (400*20%) (300*20%) (300*20%) (400*20%) Total Needs 260 380 460 960 380 Less: Opening Inventory 40 60 80 40 60 (200*20%) (200*20%) Production in units 220 320 380 920 320 ReqC: Jan Feb Mar Quarter April Production in units 220 320 380 920 320 Material need in lbs per unit 3 3 3 3 3 Production need in lbs 660 960 1140 2760 960 Add: Desired inventory 96 114 96 96 (10% of next month need) (960*10%) (1140*10%) (960*10%) (960*10%) Total needs (lbs) 756 1,074 1,236 2,856 Less: Beg Inventory 66 96 114 66 (660*10%) Material to be purchased(in lbs) 690 978 1,122 2,790 Material cost per lbs 0.5 0.5 0.5 0.5 Total cost of Purchases 345 489 561 1395

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