138Exercise 4-25A sales budget for the first five months of 2021 is given on a certainproduct line manufactured by Boots Styles, Inc.Sales budget in unitsJanuaryFebruaryMarch157,000162,000204,000АprilМay223,000245,000The inventory of finished products at the end of each month is equal to20% of the sales estimate for the next month. This requirement is expected tobe met by Jan, 1. No work is in process at the end of each month.Each unit of product requires two types of raw materials as follows:Material A½ unitMaterial B6 unitsThe estimated cost of Material A is P5.00 per unit, and the estimated costof Material B is PO.60 per unit. Materials equal to 30% of next month’sproduction needs are to be on hand at the end of each month. This requirementis expected to be met on Jan. 1.REQUIRED:1. Prepare a production budget for the first quarter of 2021 broken down bymonths. Include a total column.2. Prepare a purchases budget for each type of raw materials also for the firstquarter of 2021 broken down into months. Include a total colum.Boots Style, Inc.Production BudgetFor the First Quarter of 2021ExtraJan.Feb.MarchTotalАprilSales budgetAdd: Ending inventory (20%)Total requirementsLess: Beginning inventoryProduction budget 139Boots Style, Inc.Purchases Budyct- Material AFor the First Quarter of 2021Jan.Feb.MarchTotalProduction budgetx No. of units requiredProduction requirementsAdd: Ending inventory (30%)Total requirementsLess: Beginning inventoryPurchases budget (units)x Budgeted unit costPurchases budget (pesos)1/21/21/2Boots Style, Inc.Purchases Budget- Material BFor the First Quarter of 2021Jan.Feb.MarchTotalProduction budgetx No. of units requiredProduction requirementsAdd: Ending inventory (30%)Total requirementsLess: Beginning inventoryPurchases budget (units)x Budgeted unit costPurchases budget (pesos)6.6.6.

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Description: 138Exercise 4-25A sales budget for the first five months of 2021 is given on a certainproduct line manufactured by Boots Styles, Inc.Sales budget in unitsJanuaryFebruaryMarch157,000162,000204,000АprilМay223,000245,000The inventory of finished produc

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138 Exercise 4-25 A sales budget for the first five months of 2021 is given on a certain product line manufactured by Boots Styles, Inc. Sales budget in units January February 157,000 162,000 March 204,000 April May 223,000 245,000 The inventory of finished products at the end of each month is equal to 20% of the sales estimate for the next month. This requirement is expected to be met by Jan. 1. No work is in process at the end of each month. Each unit of product requires two types of raw materials as follows: Material A ½ unit Material B 6 units The estimated cost of Material A is P5.00 per unit, and the estimated cost of Material B is PO.60 per unit. Materials equal to 30% of next month's production needs are to be on hand at the end of each month. This requirement is expected to be met on Jan. 1. REQUIRED: 1. Prepare a production budget for the first quarter of 2021 broken down by months. Include a total column.

138 Exercise 4-25 A sales budget for the first five months of 2021 is given on a certain product line manufactured by Boots Styles, Inc. Sales budget in units January February 157,000 162,000 March 204,000 April May 223,000 245,000 The inventory of finished products at the end of each month is equal to 20% of the sales estimate for the next month. This requirement is expected to be met by Jan. 1. No work is in process at the end of each month. Each unit of product requires two types of raw materials as follows: Material A ½ unit Material B 6 units The estimated cost of Material A is P5.00 per unit, and the estimated cost of Material B is PO.60 per unit. Materials equal to 30% of next month's production needs are to be on hand at the end of each month. This requirement is expected to be met on Jan. 1. REQUIRED: 1. Prepare a production budget for the first quarter of 2021 broken down by months. Include a total column.

FINANCIAL ACCOUNTING

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Chapter1: Financial Statements And Business Decisions

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