Tyler Company budgets the following unit sales for the next four months: April, 3,400 units;...
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Accounting
Tyler Company budgets the following unit sales for the next four months: April, 3,400 units; May, 4,400 units; June, 6,800 units; and July, 2,800 units. The company's policy is to maintain finished goods inventory equal to 30% of the next month's unit sales. At the end of March, the company had 800 finished units in inventory. Prepare a production budget for each of the months of April, May, and June. TYLER COMPANY Production Budget April 3,400 June May 4,400 6,800 8,840 6,800 30 % 30 % Budgeted sales units Add: Desired ending inventory Next period budgeted sales units Ratio of inventory to future sales Desired ending inventory units Total required units Less: Beginning inventory units Units to produce 4,400 30% 1,320 800 800
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