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SmithSmith

Foods produces specialty soup sold in jars. The projected salesin dollars and jars for each quarter of the upcoming year are as?follows:

	Total sales revenue		Number of jars sold
1st quarter. . . .		$181,000	153,000
2nd quarter. . . .		$213,000	180,000
3rd quarter. . . .		$257,000	212,500
4th quarter. . . .		$194,000	163,500

SmithSmith

anticipates selling

226 comma 000226,000

jars with total sales revenue of

$ 266 comma 000$266,000

in the first quarter of the year following the year given in thepreceding table.

SmithSmith

has a policy that the ending inventory of jars must be

3030?%

of the following? quarter's sales.

Requirement

Prepare a production budget for the year that shows the numberof jars to be produced each quarter and for the year in total.

Prepare the production budget by first calculating the totalunits? needed, then calculate the units to produce.

Smith Foods
Production Budget
For the Quarters in the Upcoming Year
	Quarter 1	Quarter 2	Quarter 3	Quarter 4	Year
Unit sales	153,000	180,000	212,500	163,500	709,000
Plus: Desired ending inventory	54,000	63,750	49,050	67,800	67,800
Total needed	207,000	243,750	261,550	231,300	776,800

Less: Beginning inventory	45,900	54,000	63,750	69390	233040
Units to produce	161,100	189,750	197,800

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