urney Company produces and sells automobile batteries, the heavy-duty HD-240. The 2020 sales forecast is as follows. Quarter HD-240 1 5,100 2 7,410 3 8,180 4 10,470 The January 1, 2020, inventory of HD-240 is 2,040 units. Management desires an ending inventory each quarter equal to 40% of the next quarter’s sales. Sales in the first quarter of 2021 are expected to be 25% higher than sales in the same quarter in 2020. Prepare quarterly production budgets for each quarter and in total for 2020.
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Turney Company produces and sells automobile batteries, the heavy-duty HD-240. The 2020 sales
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Quarter
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HD-240
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| 1 | 5,100 | |
| 2 | 7,410 | |
| 3 | 8,180 | |
| 4 | 10,470 |
The January 1, 2020, inventory of HD-240 is 2,040 units. Management desires an ending inventory each quarter equal to 40% of the next quarter’s sales. Sales in the first quarter of 2021 are expected to be 25% higher than sales in the same quarter in 2020.
Prepare quarterly production budgets for each quarter and in total for 2020.
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TURNEY COMPANY
Production Budget choose the accounting period For the Year Ending December 31, 2020For the Month Ended December 31, 2020For the Quarter Ended December 31, 2020 |
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Product HD-240
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select an opening production budget item Beginning Finished Goods UnitBeginning Direct MaterialsDesired Ending Direct MaterialsDesired Ending Finished Goods UnitDirect Materials Per UnitDirect Materials PurchasesExpected Unit SalesRequired Production UnitsTotal Materials RequiredTotal Required Units
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enter a number of units
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enter a number of units
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enter a number of units
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enter a number of units
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select between addition and deduction AddLess: select a production budget item Beginning Finished Goods UnitBeginning Direct MaterialsDesired Ending Direct MaterialsDesired Ending Finished Goods UnitDirect Materials Per UnitDirect Materials PurchasesExpected Unit SalesRequired Production UnitsTotal Materials RequiredTotal Required Units
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enter a number of units | enter a number of units | enter a number of units | enter a number of units | ||||||
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select a summarizing line for the first part Beginning Finished Goods UnitBeginning Direct MaterialsDesired Ending Direct MaterialsDesired Ending Finished Goods UnitDirect Materials Per UnitDirect Materials PurchasesExpected Unit SalesRequired Production UnitsTotal Materials RequiredTotal Required Units
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enter a total number of units for the first part
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enter a total number of units for the first part
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enter a total number of units for the first part
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enter a total number of units for the first part
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select between addition and deduction AddLess: select a production budget item Beginning Finished Goods UnitBeginning Direct MaterialsDesired Ending Direct MaterialsDesired Ending Finished Goods UnitDirect Materials Per UnitDirect Materials PurchasesExpected Unit SalesRequired Production UnitsTotal Materials RequiredTotal Required Units
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enter a number of units | enter a number of units | enter a number of units | enter a number of units | ||||||
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select a closing production budget item Beginning Finished Goods UnitBeginning Direct MaterialsDesired Ending Direct MaterialsDesired Ending Finished Goods UnitDirect Materials Per UnitDirect Materials PurchasesExpected Unit SalesRequired Production UnitsTotal Materials RequiredTotal Required Units
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enter a total number of units | enter a total number of units | enter a total number of units | enter a total number of units | enter a total number of units |
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