Answer:
Sales Budget = 6840,000 + 8740,000 + 8740,000 + 15480,00 = $ 39800,000
Production Budget, = 490,000+ 230,000 + 256,000 +327,600= 1303600
Purchases Cost Budget = $ 475,0000 + 462, 6000 + 519,1000 + 649,5000 = $2106,2000
Explanation:
Pargo Company
Sales Budget
For the year 2020
QUARTERS
1 2 3 4 TOTAL
18%, 23%, 23%, 36%,
Sales, 180,000 230,000 230,000 360,000
<u>Sale Price $38 $ 38 $ 38 $ 43</u>
<u>Sales Budget 6840,000 8740,000 8740,000 15480,00 </u><u>$ 39800,000</u><u> </u>
Pargo Company
Production Budget
For the year 2020
QUARTERS
1 2 3 4 TOTAL
Sales 180,000 230,000 230,000 360,000
+Ending Inventory 46,000 46000 72000 39,600*
<u>-Opening Inventory</u><u> 264,000*</u><u> 46000 46000 72000</u>
<u>Production, 490,000 230,000 256,000 327,600 </u><u>1303600</u>
Working:
The opening inventory is calculated as the production ius already given. 264,000
Sales of 1st quarter 2020 = 180,000
Sales of 1st quarter 2021 = 180,000 + 18,000= 198,000
Ending inventory of 4th quarter of 2020 = 198,000* 20%= 39,600
Pargo Company
Direct Materials Budget
For the year 2020
QUARTERS
1 2 3 4
Units Produced 490,000 230,000 256,000 327,600
Direct materials
<u>Per Unit 2 pounds 2 pounds 2 pounds 2 Pounds</u>
D. Mat Used 980,000 460,000 512,000 655,200
Add Desired
Ending Inv 23,000 25,600 32,700 27,000
Less Beginning
<u>Inventory </u><u>528,000*</u><u> 23,000 25,600 32,700</u>
D. Materials
Purchases 475,000 462, 600 519,100 649,500
<u>Cost per pounds $ 10 $ 10 $ 10 $ 10</u>
<u>Purchases Cost $ </u><u> 475,0000 462, 6000 519,1000 649,5000 </u>TOTAL $<u>2106,2000</u>
<u></u>
<u></u>
The beginning inventory is calculated from the production budget opening inventory.
<u></u>