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Preparation of Production budget for the Pletcher Company

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Pletcher Company produces and sells automobile batteries, the heavy-duty HD-240. The 2011 sales budget is as follows.
Quarter HD-240
1 4,600
2 6,900
3 7,590
4 10,780
The January 1, 2011, inventory of HD-240 is 2,510 units. Management desires an ending inventory each quarter equal to 60% 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 amounts and subtract where necessary.)

PLETCHER COMPANY
Production Budget
For the Year Ending December 31, 2011
Product HD-240
Quarter
1 2 3 4 Year
Expected unit sales
4600
6,900
7,590
10,780

Add: Desired end. finished goods units

Total required units

Less: Beg. finished goods units
4140
4554
6468

Required production units

Purchase this Solution

Solution Summary

Pletcher Company produces and sells automobile batteries, the heavy-duty HD-240. The 2011 sales budget is as follows.
Quarter HD-240
1 4,600
2 6,900
3 7,590
4 10,780
The January 1, 2011, inventory of HD-240 is 2,510 units. Management desires an ending inventory each quarter equal to 60% 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 amounts and subtract where necessary.)

PLETCHER COMPANY
Production Budget
For the Year Ending December 31, 2011
Product HD-240
Quarter
1 2 3 4 Year
Expected unit sales
4600
6,900
7,590
10,780

Add: Desired end. finished goods units

Total required units

Less: Beg. finished goods units

4140
4554
6468

Required production units

Purchase this Solution


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