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Cahuilla Corporation predicts the following sales in units for the coming four months: April May June July Sa...

Cahuilla Corporation predicts the following sales in units for the coming four months:

April May June July
Sales in Units 270 310 330 270


Each month's ending finished goods inventory should be 30% of the next month's sales. March 31 finished goods inventory is 81 units. A finished unit requires 5 pounds of direct material B at a cost of $3.00 per pound. The March 31 Raw Materials Inventory has 230 pounds of B. Each month's ending Raw Materials Inventory should be 20% of the following month's production needs. The budgeted production for May is:

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Answer #1

Production for May = Sale unit+Desired ending inventory-Beginning inventory

= 310+(330*30%)-(310*30%)

Production for may = 316 Units

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