3) Ehrlich Manufacturing Corporation manufactures and sells wooden puzzles. Expected puzzle sales at Ehrlich (in units) for the next three months are as follows: January February March budgeted unit sales: 27,000 25,000 30,000 Ehrlich likes to maintain a finished goods inventory equal to 30% of the next month's estimated sales. How many puzzles should Ehrlich plan on producing during the month of February? Show your calculations.
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
3) Ehrlich Manufacturing Corporation manufactures and sells wooden puzzles. Expected puzzle sales at Ehrlich (in units) for the next three months are as follows:
January February March
budgeted unit sales: 27,000 25,000 30,000
Ehrlich likes to maintain a finished goods inventory equal to 30% of the next month's estimated sales. How many puzzles should Ehrlich plan on producing during the month of February?
Show your calculations.
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