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electro company Electro Company manufactures transmissions for electric cars. Management...

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Accounting

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Electro Company manufactures transmissions for electric cars. Management reports ending finished goods inventory for the first quarter at 21,300 units. The following unit sales are budgeted during the rest of the year: second quarter, 213,000 units; third quarter, 271,000 units; and fourth quarter, 250,000 units. Company policy calls for the ending finished goods inventory of a quarter to equal 10% of the next quarter's budgeted unit sales. Prepare a production budget for both the second and third quarters that shows the number of transmissions to manufacture. ELECTRO COMPANY Production Budget Second Quarter Third Quarter Budgeted sales units 21,300 Add: Desired ending inventory Next period budgeted sales units Budgeted sales units Desired ending inventory units Total required units Less: Beginning inventory units Units to produce

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