E8-2 - Please explain how you arrived at your answers. Thank you! Exercise 8-2 P
ID: 2416391 • Letter: E
Question
E8-2 - Please explain how you arrived at your answers. Thank you!
Exercise 8-2 Production Budget [LO3]
Crystal Telecom has budgeted the sales of its innovative mobile phone over the next four months as follows:
The company is now in the process of preparing a production budget for the third quarter. Past experience has shown that end-of-month finished goods inventories must equal 10% of the next month’s sales. The inventory at the end of June was 3,000 units.
Exercise 8-2 Production Budget [LO3]
Crystal Telecom has budgeted the sales of its innovative mobile phone over the next four months as follows:
Sales in Units July 30,000 August 36,000 September 65,000 October 45,000The company is now in the process of preparing a production budget for the third quarter. Past experience has shown that end-of-month finished goods inventories must equal 10% of the next month’s sales. The inventory at the end of June was 3,000 units.
Required: Prepare a production budget for the third quarter showing the number of units to be produced each month and for the quarter in total. (Do not round intermediate calculations. Input all amounts as positive values.) Crystal TelecomProduction Budget July August September Quarter Budgeted sales in units (Click to select)AddDeduct: (Click to select)Beginning inventoryEnding inventory Total needs (Click to select)AddDeduct: (Click to select)Beginning inventoryEnding inventory Required production in units
Explanation / Answer
Solution: Production Budget of Crystal Telecom
Note: July 3000+10% of 3000= 3300
August : 3300+10%of 3300=3630
Sepetember : 3630+10%of 330= 3993
particular July August September quarter Budgeted sales in units 3300 3630 3993 10923Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.