Vaughn Company estimates that unit sales will be 12,400 in quarter 1, 17,360 in quarter 2, 18,600 in quarter 3, and 22,320 in quarter 4. The unit selling price is $70. Management desires to have an ending �nished goods inventory equal to 25% of the next quarter’s expected unit sales.
Prepare a production budget by quarters for the �rst 6 months of 2022.
Current Attempt in Progress
Bramble Company expects to have a cash balance of $43,200 on January 1, 2022. Relevant monthly budget data for the �rst 2 months of 2022 are as follows.
Collections from customers: January $81,600, February $144,000.
Payments for direct materials: January $48,000, February $72,000.
Direct labor: January $28,800, February $43,200. Wages are paid in the month they are incurred.
Manufacturing overhead: January $20,160, February $24,000. These costs include depreciation of $1,440 per month. All other overhead costs are paid as incurred.
Selling and administrative expenses: January $14,400, February $19,200. These costs are exclusive of depreciation. They are paid as incurred.
Sales of marketable securities in January are expected to realize $11,520 in cash. Bramble Company has a line of credit at a local bank that enables it to borrow up to $24,000. The company wants to maintain a minimum monthly cash balance of $19,200.