2 ~345 Production Budget 5 Budgeted sales volume Add: Target ending FG inventory 6 7 8 9 10 11 12 13 15 14 x Pounds of DM per unit Total production needs (pounds) Add:Target ending DM inventory (pounds) Total DM inventory needs (pounds) Less: Beginning DM inventory (pounds) Budgeted pounds of DM to be purchased 20 x DM cost per pound Total budgeted cost of DM purchases 19 16 17 18 21 Total units needed Less: Beginning FG inventory Budgeted units to be produced 22 23 24 DM Purchases Budget Budgeted units to be produced Posey's Pet Emporium July [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] July [insert formula] [Insert formula] [Insert formula] [Insert formula] August [Insert formula [insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] August [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] September [Insert formula] [insert formula] [Insert formula] [Insert formula] September [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] Quarter [Insert formula] [insert formula] [Insert formula] [Insert formula] Quarter [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula]/nPosey's Pet Emporium Selling price Less: Target gross margin percentage Cost of goods sold Less: DM cost per unit Additional cost per unit to cover DL and MOH [Insert formula] [Insert formula] [Insert formula] [Insert formula] [Insert formula]/nsnhu ACC 311 Project Two Scenario You are the cost accountant at Posey's Pet Emporium tasked with preparing quarterly budgets that determine the cash effects of the company's sales and production-related expenditures. The company uses a calendar year, and it is time to prepare the third-quarter budget. You have the following information: 1. The budgeted selling price for the year is $4.99 per unit. Sales volumes are budgeted as follows for the last month of quarter two, for all of quarter three, and for part of quarter four. June September 35,000 2. Historically, 20% of Posey's sales are cash sales. Of the remaining credit sales, 45% are collected in the month of sale, while 52% are collected the following month. The remainder is deemed uncollectible. July 33,500 August 32,000 October 35,200 34,000 3. Management sets its ending finished goods inventory goal at 15% of the following month's sales volume. The accounting team expects this policy will be met at the beginning of the second quarter. 4. The target ending inventory for Posey's primary direct material is 20% of the following month's production needs. Each completed unit requires five pounds of direct materials at an expected cost of $0.25 per pound. The budgeted production for October is 34,000. 5. Posey's pays for 40% of its purchases in the month of purchase and 60% the month after purchase. Total budgeted purchases in June are $20,000. 6. Posey's ending cash balance on June 30 was $57,950. 7. Posey's non-production cash disbursements are estimated at $80,000 per month.

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