On January 1, 2013 the Batista Company budget committee has reached agreement on the following data for the 6 months ending June 30, 2013.
Sales units: First quarter 5,000; second quarter 6,000; third quarter 7,000
Ending raw materials inventory: 50% of the next quarter’s production requirements
Ending finished goods inventory: 30% of the next quarter’s expected sales units
Third-quarter production: 7,250 units
The ending raw materials and finished goods inventories at December 31, 2012, follow the same percentage relationships to production and sales that occur in 2013. Three pounds of raw materials are required to make each unit of finished goods. Raw materials purchased are expected to cost $4 per pound.
Complete the production budget by quarters for the 6-month period ended June 30, 2013.
BATISTA COMPANY
Production Budget
For the Six Months Ending June 30, 2013
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1 2 Months
Add:
Total required units
Less:
Required production units
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