Franklin Products Limited manufactures and distributes a numberof products to retailers. One of these products, SuperStick,requires five kilograms of material D236 in the manufacture of eachunit. The company is now planning raw materials needs for the thirdquarter—July, August, and September. Peak sales of SuperStick occurin the third quarter of each year. To keep production and shipmentsmoving smoothly, the company has the following inventoryrequirements:
- The finished goods inventory on hand at the end of each monthmust be equal to 8,650 units plus 20% of the next month’s sales.The finished goods inventory on June 30 is budgeted to be 22,780units.
- The raw materials inventory on hand at the end of each monthmust be equal to 40% of the following month’s production needs forraw materials. The raw materials inventory on June 30 for materialD236 is budgeted to be 131,600 kilograms.
- The company maintains no work in process inventories.
A sales budget for SuperStick for the last six months of theyear follows:
| Budgeted Sales
in Units |
| July | 61,300 |
| August | 75,650 |
| September | 106,300 |
| October | 53,650 |
| November | 30,650 |
| December | 15,260 |
|
Required:
1. Prepare a production budget for SuperStick forJuly, August, September, and October.
2. Not available in Connect.
3. Prepare a direct materials purchases budgetshowing the quantity of material D236 to be purchased for July,August, and September and for the quarter in total.
