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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.
Sales in Units
July
30,000
August
45,000
September
60,000
October
50,000
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.
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