Electro Company manufactures an innovative automobile transmission for electric

Question

Electro Company manufactures an innovative automobile transmission for electric cars. Management predicts that ending finished goods inventory for the first quarter will be 173,500 units. The following unit sales of the transmissions are expected during the rest of the year: second quarter, 347,000 units; third quarter, 332,000 units; and fourth quarter, 334,000 units. Company policy calls for the ending finished goods inventory of a quarter to equal 50% of the next quarter's budgeted sales Prepare a production budget for both the second and third quarters that shows the number of transmissions to manufacture points ELECTRO COMPANY Production Budget Second and Third Quarters 01:57:12 Second Quarter Third Quarter Budgeted unit sales for quarter Budgeted ending inventory (unts) Required units of available production Budgeted beginning inventory (units) Units to be produced

Explanation / Answer

ELECTRO COMPANY

Production Budget

Second and Third Quarters

Budgeted ending inventories

Second quarter (50% × 332,000) = 166,000

Third quarter (50% × 334,000) = 167,000

Second Quarter Third Quarter Budgeted ending inventory (units) 166,000 167,000 Budgeted unit sales for quarter 347,000 332,000 Required units of available production 513,000 499,000 Budgeted beginning inventory (units) (173,500) (166,000) Units to be produced 339,500 333,000

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.