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King Corporation Has the Following Budgeted Sales for the Selected

Question 137

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King Corporation has the following budgeted sales for the selected six-month period:  Month  Unit Sales  June 15,000 July 20,000 August 35,000 September 25,000 October 30,000 November 20,000\begin{array} { l r } \text { Month } & \text { Unit Sales } \\ \text { June } & 15,000 \\\text { July } & 20,000 \\\text { August } & 35,000 \\\text { September } & 25,000 \\\text { October } & 30,000 \\\text { November } & 20,000\end{array} There were 7,500 units of finished goods inventory at the beginning of June. Plans are to have a finished goods inventory equal to 20% of the unit sales for the next month.
Three kilograms of direct materials are required for each unit produced. Each kilogram of material costs $20. Ending direct materials inventory equals 30% of the needs for the next month. Direct materials inventory on June 1 was 5,000 kg.
Required:
A. Prepare production budgets in units for July, August, and September.
B. Prepare a purchases budget in kilograms and dollars for July, August, and September.

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A. * 30% times next month's ...

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