Production Budget Assume that Stillwater Designs produces two automotive subwoofers: S12L7 and S12L5. The S12L7 sells...

Production Budget

	S12L7	S12L5
First quarter, 20Y1	920	1,495
Second quarter, 20Y1	2,530	1,610
Third quarter, 20Y1	6,440	6,095
Fourth quarter, 20Y1	5,290	4,485
First quarter, 20Y2	1,035	1,380

The vice president of sales believes that the projected sales are realistic and can be achieved by the company.

Stillwater Designs needs a production budget for each product (representing the amount that must be outsourced to manufacturers located in Asia). Beginning inventory of S12L7 for the first quarter of 20Y1 was 340 boxes. The company's policy is to have 20% of the next quarter's sales of S12L7 in ending inventory. Beginning inventory of S12L5 was 170 boxes. The company's policy is to have 30% of the next quarter's sales of S12L5 in ending inventory.

Required:

Prepare a production budget for each quarter for 20Y1 and for the year in total.

Stillwater Designs
Production Budget for S12L7
For the Year Ended December 31, 20Y1
	1st Qtr.	2nd Qtr.	3rd Qtr.	4th Qtr.	Year
Sales
Desired ending inventory
Total needs
Less: Beginning inventory
Units produced

Prepare a production budget for each quarter for 20Y1 and for the year in total. If required, round your answers to nearest whole value.

Stillwater Designs
Production Budget for S12L5
For the Year Ended December 31, 20Y1
	1st Qtr.	2nd Qtr.	3rd Qtr.	4th Qtr.	Year
Sales
Desired ending inventory
Total needs
Less: Beginning inventory
Units produced

Solutions

Expert Solution

Production Budget - Stillwater - S12L7
Particulars	Q-1	Q-2	Q-3	Q-4	Total
Projected Sales Unit	920	2530	6440	5290	15180
Add: Desired ending inventory (20% of next Quarter sales)	506	1288	1058	207	207
Total Needs	1426	3818	7498	5497	15387
Less: Beginning Inventory	340	506	1288	1058	340
Production Required	1086	3312	6210	4439	15047
* Endin Inventory for Q-4=1035*20%= 207

Production Budget - Stillwater - S12L5
Particulars	Q-1	Q-2	Q-3	Q-4	Total
Projected Sales Unit	1495	1610	6095	4485	13685
Add: Desired ending inventory (30% of next Quarter sales)	483	1828.5	1345.5	414	414
Total Needs	1978	3438.5	7440.5	4899	14099
Less: Beginning Inventory	170	483	1828.5	1345.5	170
Production Required	1808	2955.5	5612	3553.5	13929
* Endin Inventory for Q-4=1380*30%= 414

ekkarill92 answered 1 year ago

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