Question 1:
Turney Company produces and sells automobile batteries, the heavy-duty HD-240. The 2014 sales forecast is as follows.
| Quarter |
|
HD-240 |
| 1 |
|
5,300 |
| 2 |
|
7,370 |
| 3 |
|
8,400 |
| 4 |
|
10,200 |
The January 1, 2014, inventory of HD-240 is 2,120 units. Management desires an ending inventory each quarter equal to 40% of the next quarter's sales. Sales in the first quarter of 2015 are expected to be 25% higher than sales in the same quarter in 2014.
Prepare quarterly production budgets for each quarter and in total for 2014.