Fisher-Price manufactures two products, Bassinet and Swing, which use raw materials, pins and clips. One...
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Accounting
Fisher-Price manufactures two products, Bassinet and Swing, which use raw materials, pins and clips. One bassinet uses 4 units of pins and 3 units of clips. One swing uses 2 units of pins and 6 units of clips. One pin is expected to cost $7 and one clip is expected to cost $5.
Sales and finished goods inventory budget for the year 2020 are as follows:
Bassinets
Swings
Budgeted sales
5,000 units
Budgeted sales
7.000 units
Opening inventory
1,000 units
Opening inventory
2,000 units
Closing inventory
600 units
Closing inventory
800 units
Selling price
$400
Selling price
$300
Raw material inventory budget for the year 2020 are as follows:
Pins
Clips
Opening inventory
2,400 units
Opening inventory
3,300 units
Closing inventory
500 units
Closing inventory
600 units
The warehouse and stores managers have suggested that a provision should be made for damages and deterioration of items held in store, as follows.
Product
Bassinets
Loss of 80 units
Swings
Loss of 50 units
Raw materials
Pins
Loss of 30 units
Clips
Loss of 20 units
Required:
Prepare the following for the year 2020:
Sales budget
Production budget
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