Question

KylerKyler

Foods produces specialty soup sold in jars. The projected sales in dollars and jars for each quarter of the upcoming year are as? follows:

	Total sales revenue		Number of jars sold
1st quarter. . . .		$185,000	154,500
2nd quarter. . .		$213,000	180,000
3rd quarter. . . .		$257,000	210,500
4th quarter. . . .		$199,000	161,000

KylerKyler

anticipates selling

226 comma 000226,000

jars with total sales revenue of

$ 265 comma 000$265,000

in the first quarter of the year following the year given in the preceding table.

KylerKyler

has a policy that the ending inventory of jars must be

3030?%

of the following? quarter's sales.

Requirement

Prepare a production budget for the year that shows the number of jars to be produced each quarter and for the year in total.

Prepare the production budget by first calculating the total units? needed, then calculate the units to produce.

Kyler Foods
Production Budget
For the Quarters in the Upcoming Year
	Quarter 1	Quarter 2	Quarter 3	Quarter 4	Year
Unit sales
Plus: Desired ending inventory
Total needed

Answer 1

			Production Budget
				Quarter 1	Quarter 2	Quarter 3	Quarter 4	Year
	Unit sales			154500	180000	210500	161000	706000
	Add: Desired ending inventory			54000	63150	48300	67800	233250
	(30% of next quarte sale)			(180000*30%)	(210500*30%)	(161000*30%)	(226000*30%)
	Total needed			208500	243150	258800	228800	939250
	Less: Beginning inventory			46350	54000	63150	48300	211800
	(30% of current quarter sale)			(154500*30%)	(180000*30%)	(210500*30%)	(161000*30%)
	Unit to produce			162150	189150	195650	180500	727450