It is decided that stuff toys inventories are to be 20,000 pieces at the end of the third quarter, and 5,000 pieces at the end of the fourth quarter. The inventory at the start of the third quarter will consist of 8,000 stuff toys. Each stuff toy is packaged in a colorful cardboard box, and contains 2 units of Material A and 5 units of Material B. The inventory of materials at the beginning of the third quarter will be: 125,000 pieces 15,000 units Вохes Material A Material B 45,000 units There are sufficient boxes on hand for both quarters; none will be purchased during the two periods. Material A can be bought whenever needed and in any quantity desired. The starting inventory of 15,000 units is considered to be an ideal quantity. Material B must be purchased in quantities of 10,000 units, or multiples of 10,000. It is desired that at the end of the third and fourth quarters, a minimum quantity of 30,000 units be on hand, or as close thereto as the standard quantity will permit. REQUIRED: 1. Prepare a production budget for the third and fourth quarters of 2021.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
Millet Corporation manufactures and sells stuff toys. She is busy with the
third and fourth quarters of 2021 at the moment. She asks your help to prepare
some of these budgets:
The sales budget in units is as follows:
45,000 pieces
70,000 pieces
Third quarter
Fourth quarter
Transcribed Image Text:Millet Corporation manufactures and sells stuff toys. She is busy with the third and fourth quarters of 2021 at the moment. She asks your help to prepare some of these budgets: The sales budget in units is as follows: 45,000 pieces 70,000 pieces Third quarter Fourth quarter
It is decided that stuff toys inventories are to be 20,000 pieces at the end
of the third quarter, and 5,000 pieces at the end of the fourth quarter. The
inventory at the start of the third quarter will consist of 8,000 stuff toys.
Each stuff toy is packaged in a colorful cardboard box, and contains 2
units of Material A and 5 units of Material B.
The inventory of materials at the beginning of the third quarter will be:
Boxes
125,000 pieces
Material A
15,000 units
Material B
45,000 units
There are sufficient boxes on hand for both quarters; none will be
purchased during the two periods.
Material A can be bought whenever needed and in any quantity desired.
The starting inventory of 15,000 units is considered to be an ideal quantity.
Material B must be purchased in quantities of 10,000 units, or multiples
of 10,000. It is desired that at the end of the third and fourth quarters, a
minimum quantity of 30,000 units be on hand, or as close thereto as the
standard quantity will permit.
REQUIRED:
1. Prepare a production budget for the third and fourth quarters of 2021.
2. Prepare a purchases budget for Material A and Material B for the third and
fourth quarters of 2021.
3. How many
boxes will be on hand at the end of the fourth quarter?
Transcribed Image Text:It is decided that stuff toys inventories are to be 20,000 pieces at the end of the third quarter, and 5,000 pieces at the end of the fourth quarter. The inventory at the start of the third quarter will consist of 8,000 stuff toys. Each stuff toy is packaged in a colorful cardboard box, and contains 2 units of Material A and 5 units of Material B. The inventory of materials at the beginning of the third quarter will be: Boxes 125,000 pieces Material A 15,000 units Material B 45,000 units There are sufficient boxes on hand for both quarters; none will be purchased during the two periods. Material A can be bought whenever needed and in any quantity desired. The starting inventory of 15,000 units is considered to be an ideal quantity. Material B must be purchased in quantities of 10,000 units, or multiples of 10,000. It is desired that at the end of the third and fourth quarters, a minimum quantity of 30,000 units be on hand, or as close thereto as the standard quantity will permit. REQUIRED: 1. Prepare a production budget for the third and fourth quarters of 2021. 2. Prepare a purchases budget for Material A and Material B for the third and fourth quarters of 2021. 3. How many boxes will be on hand at the end of the fourth quarter?
Expert Solution
steps

Step by step

Solved in 2 steps with 1 images

Blurred answer
Knowledge Booster
Cost Sheet
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education