Question

3. Troy Corporation has the following budgeted sales for the selected four-month period: Month Unit Sales...

3. Troy Corporation has the following budgeted sales for the selected four-month period: Month Unit Sales October 40,000 November 70,000 December 50,000 January 60,000

There were 14,000 units of finished goods in inventory at the beginning of October. Plans are to have an inventory of finished product equal to 25 percent of the unit sales for the next month. Five pounds of a single raw material are required for each unit produced. Each pound of material costs $10. Plans are to have inventory levels for materials equal to 30 percent of the amount of materials needed to satisfy next month's production and 84,000 units of raw material on hand at the end of December. Materials inventory on October 1 was 60,000 pounds. Required: - 8points a. Prepare a production budget in units for October, November, and December. b. Prepare a purchase budget in pounds and dollars for October, November, and December

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