Question

Denver Yards Manufacturing expects to sell the following number of trimmers each month for $150 each:...

Denver Yards Manufacturing expects to sell the following number of trimmers each month for $150 each: July 1,750 Trimmers August 1,500 Trimmers September 750 Trimmers October 500 Trimmers On June 30, Denver Yards Manufacturing had 100 bush trimmers in inventory. The company has a policy that the ending inventory in any month must be 16% of the following month's expected sales. Required: Prepare a sales budget for July till September. Prepare a production budget for July till September, with a column for each month.

Homework Answers

Answer #1

Sales Budget

July

August

September

Budgeted Sales (in units)

1,750

1,500

750

Expected Selling Price

$150

$150

$150

Budgeted Sales ($)

$262,500

$225,000

$112,500

Production Budget (in units)

July

August

September

Budgeted Sales

1,750

1,500

750

Add: Ending Inventory

240

120

80

(1,500 * 16%)

(750 * 16%)

(500 * 16%)

Less: Beginning Inventory

100

240

120

Trimmers to be produced

1,890

1,380

710

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