(b) A sales budget is given below for one of the products manufactured by N.Ltd .For six months ended 30th June 2021. Month Units January 60,000 February 105,000 March 180,000 April 120,000 Мay 90,000 June 75,000 The inventory of finished goods at the end of each month equal 20% at the next month's sales Page 1 of 4 On 1st Jan 2021, finished goods inventory totaled 12,000 units. Each unit of the product requires nine units of a specialized liquid known as HN-2, sometimes this extract is in short supply for this reason, the company has a policy of maintaining an inventory at the end of each month equal to 30%of next month's production needed. This requirement was met on 1st Jan 2021. Required (i) Prepare a budget showing the quantity of NH-2 to be purchased each month from January, February and March and in total for the three months period (ii) What is the significance of budgeting in any business organization

(b) A sales budget is given below for one of the products manufactured by N.Ltd .For six months ended 30th June 2021. Month Units January 60,000 February 105,000 March 180,000 April 120,000 Мay 90,000 June 75,000 The inventory of finished goods at the end of each month equal 20% at the next month's sales Page 1 of 4 On 1st Jan 2021, finished goods inventory totaled 12,000 units. Each unit of the product requires nine units of a specialized liquid known as HN-2, sometimes this extract is in short supply for this reason, the company has a policy of maintaining an inventory at the end of each month equal to 30%of next month's production needed. This requirement was met on 1st Jan 2021. Required (i) Prepare a budget showing the quantity of NH-2 to be purchased each month from January, February and March and in total for the three months period (ii) What is the significance of budgeting in any business organization

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 15E: Palmgren Company produces consumer products. The sales budget for four months of the year is...

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