Question

One Device makes universal remote controls and expects to sell 500 units in January, 850 in February, 450 in March, 500 in April, and 600 in May. The required ending inventory is 30% of the next month’s sales.

Prepare a production budget for the first four months of the year.

One Device
Production Budget
For the Four Months Ending April 30, 20XX
	January	February	March	April
Expected Sales
Total Required Units
Required Production
Total

Answer 1

One Device
Production Budget
For the Four Months Ending April 30, 20XX
	January	February	March	April
Expected Sales	500	850	450	500
Add: Required Ending Inventory	255	135	150	180
Total Required Units	755	985	600	680
Less: Opening Inventory	150	255	135	150
Required Production	605	730	465	530
Total	605	730	465	530

Notes:

1. Required Ending Inventory:

Month	January	February	March	April
Details	30% * Expected Sales of February	30% * Expected Sales of March	30% * Expected Sales of April	30% * Expected Sales of May
	30% * 850	30% * 450	30% * 500	30% * 600

2. Opening Inventory:

January	February	March	April
30% * Expected Sales of January	30% * Expected Sales of February	30% * Expected Sales of March	30% * Expected Sales of April
30% * 500	30% * 850	30% * 450	30% * 500