Problem - Short Company produces two products: X Brand and Y Brand. Budgeted sales for four months are as follows:
X Brand Y Brand
May 10,000 40,000
June 20,000 70,000
July 15,000 80,000
August 30,000 90,000
Short's ending inventory policy is that X Brand should have 10% of its next month's sales in ending inventory and Y Brand should have 20% of next month's sales in its ending inventory. On May 1, Shortie's inventory had 1,000 units of X Brand and 9,000 units of Y Brand.
Y Brand requires four units of component A. (X Brand does not use component A.) On May 1, 2,100 units of component A were in inventory. Short wants to have 30% of the following month's production needs in inventory for component A.
How many units of Y Brand are budgeted for production in June? Brand X in May?