chrystal telcom has budget the sale of its moble phone over the next 4 months/ july -30,000

EXERCISE 2 Production Budget

Crystal Telecom has budgeted the sales of its innovative mobile phone over the next four months as follows:

The company is now in the process of preparing a production budget for the third quarter. Past experience has shown that end-of-month finished goods inventories must equal 10% of the next month”s sales. The inventory at the end of June was 3,000 units.

Required:

Prepare a production budget for the third quarter showing the number of units to be produced each month and for the quarter in total.