Accounting: What the Numbers Mean 11th Edition by Wayne McManus,Daniel Viele,David Marshall

Exercise 5

Production and purchases budgets Olympia Productions, Inc., makes award medallions that are attached to ribbons. Each medallion requires 18 inches of ribbon. The sales forecast for February is 2,000 medallions. Estimated beginning inventories and desired ending inventories for February are as follows:

Required:
a. Calculate the number of medallions to be produced in February.
b. Calculate the number of yards of ribbon to be purchased in February.