VAUGHN COMPANY Production Budget

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.

Don't use plagiarized sources. Get Your Custom Essay on
VAUGHN COMPANY Production Budget
Just from $13/Page
Order Essay

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.