Question

Gizzardi Company has projected the following sales of Product #431 for the first four months of 2010: January, 8,000 units; February, 7,600 units; March, 11,200 units; April, 5,800 units; and May, 6,100 units. Each unit of product requires two-and-a-half gallons of Material X and three pounds of Material Y. Expected beginning-of-the-year inventories for all items follow.
Product #431............................... 1,680 units
Material X.................................... 5,800 gallons
Material Y.................................... 7,200 pounds
Gizzardi desires an ending inventory for Product #431 of 20 percent of the following month’s sales and ending inventories for components X and Y of 30 percent of that month’s production quantity needs. Material X costs $5.90 per gallon, and Material Y costs $3.75 per pound.
Required:
(a) Prepare a production budget for Product #431.
(b) Prepare purchases budgets for Materials X and Y.


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  • CreatedMarch 27, 2015
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