Question

Production Budget

Pasadena Candle Inc. projected sales of 800,000 candles for the year. The estimated January 1 inventory is 35,000 units, and the desired December 31 inventory is 20,000 units.
Prepare a production budget report in units for Pasadena Candle Inc. For those boxes in which you must enter subtracted or negative numbers use a minus sign.
Pasadena Candle Inc.
Production Budget
For the Year Ending December 31
Total units available
Total units to be produced

Answer 1

Pasadena Candle Inc.

Pasadena Candle Inc.

Production Budget

For the Year Ending December 31

Total units available:

Project sales 800,000

Desired ending inventory 20,000 820,000

Beginning inventory 35,000

Total units to be produced 785,000

Step-by-step explanation:

a) Data and Calculations:

Projected sales of candles for the year = 800,000 candles

January 1 inventory = 35,000 units

Desired December 31 inventory = 20,000 units

Units available for sale = 820,000 (800,000 + 20,000)

Production for the year = 785,000 (820,000 - 35,000)