A sales budget is given below for one of the products
manufactured by the OMI Co.:
The inventory of finished goods at the end of each month must equal
30% of the next month's sales. However, on December 31 the finished
goods inventory totaled only 4,500 units.
Each unit of product requires four pounds of specialized material.
Since the production of this specialized material by OMI's
suppliers is sometimes irregular, the company has a policy of
maintaining an ending inventory at the end of each month equal to
25% of the next month's production needs. This requirement had been
met on January 1 of the current year.
Prepare a production budget for the first four months of the
year.
A sales budget is given below for one of the products manufactured by the OMI Co.: The inventory of finished goods at th
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