Begin by preparing a sales budget for April, May, and June.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Kessler Company manufactures drinking glasses. One unit is a package of eight glasses, which sells for $25. Kessler projects sales for April will be 4,500 packages, with sales increasing by 300 packages per month for May, June, and July. On April 1, Kessler has 225 packages on hand but desires
to maintain an ending inventory of 10% of the next month's sales. Prepare a sales budget and a production budget for Kessler for April, May, and June.
Begin by preparing a sales budget for April, May, and June.
Kessler Company
Sales Budget
April, May, and June
April
May
Budgeted packages to be sold
Sales price per package
Total sales
$
Budgeted packages to be sold
4,500
Now prepare a production budget for April, May, and June.
4,800
25 $
112,500 $ 120,000
Plus:
Total packages needed
Less: Packages in beginning inventory
Budgeted packages to be produced
Desired packages in ending inventory
25 $
Kessler Company
Production Budget
April, May, and June
April
June
5,100
25 $
$
$ 127,500
May
Total
14,400
25
360,000
June
Total
Transcribed Image Text:Kessler Company manufactures drinking glasses. One unit is a package of eight glasses, which sells for $25. Kessler projects sales for April will be 4,500 packages, with sales increasing by 300 packages per month for May, June, and July. On April 1, Kessler has 225 packages on hand but desires to maintain an ending inventory of 10% of the next month's sales. Prepare a sales budget and a production budget for Kessler for April, May, and June. Begin by preparing a sales budget for April, May, and June. Kessler Company Sales Budget April, May, and June April May Budgeted packages to be sold Sales price per package Total sales $ Budgeted packages to be sold 4,500 Now prepare a production budget for April, May, and June. 4,800 25 $ 112,500 $ 120,000 Plus: Total packages needed Less: Packages in beginning inventory Budgeted packages to be produced Desired packages in ending inventory 25 $ Kessler Company Production Budget April, May, and June April June 5,100 25 $ $ $ 127,500 May Total 14,400 25 360,000 June Total
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