What actions should modesto take based on the budget

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Question - Modesto Company purchases Product Alpha from a supplier for resale.  The company's controller has just completed the purchases budget for the first four months of next year as shown below.

 

January

February

March

April

Budgeted unit sales

30,000

40,000

60,000

50,000

Desired Ending Inventory

8,000

12,000

10,000

4,000

Units Required

38,000

52,000

70,000

54,000

Beginning Inventory

6,000

8,000

12,000

10,000

Budgeted Purchases

32,000

44,000

58,000

44,000

The company's supplier can provide a maximum of 50,000 units per month. What actions, if any, should Modesto take based on the budget information presented?

Reference no: EM133112936

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