Turney Company produces and sells automobile batteries, the heavy-duty HD-240.
The 2014 sales forecast is as follows.
Quarter HD-240
1 ......................... 5,000
2 ......................... 7,000
3 ......................... 8,000
4 ........................ 10,000
The January 1, 2014, inventory of HD-240 is 2,000 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.
Instructions
Prepare quarterly production budgets for each quarter and in total for 2014.