6 - Final exam practice PDF

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Final exam practice...

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8/15/2021

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6.

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Down Under Products, Ltd., of Australia, has budgeted sales of its popular boomerang for the next four months as follows: April May June July

Sales in Units 50,000 75,000 90,000 80,000

The company is now in the process of preparing a production budget for the second quarter. Past experience has shown that end-of-month inventory levels must equal 10% of the following month’s sales. The inventory at the end of March was 5,000 units. (Australia’s currency is the Australian dollar.) Required: Prepare a production budget for the second quarter; in your budget, show the number of units to be produced each month and for the quarter in total. DOWN UNDER PRODUCTS, LTD. Production Budget April

May

June

Quarter

Total needs

References Worksheet

Learning Objective: 07-02 Prepare each component budget of the master budget.

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