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Section B:--Production Budget The ASU Company manufactures a special line of graphic tubing items. The company estimates it w
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Answer #1

a.

Production of finished product in 2020 = Sales + Ending inventory of finished goods - Beginning inventory of finished goods

= 75,000 + 10,000 - 20,000

= 65,000 units

b.

Plastic tubing required per unit of finished product = 5 feet

Production = 65,000 units

Plastic required for production = Plastic tubing required per unit of finished product x Production

= 5 x 65,000

= 325,000 feet

Beginning inventory of plastic tubing = 70,000 feet

Ending inventory of plastic tubing = 65,000 x 3/2 x 5

= 81,250

Plastic tubing to be purchased = Plastic required for production + Ending inventory of plastic tubing - Beginning inventory of plastic tubing

= 325,000 + 81,250 - 70,000

= 336,250 feet

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