Katherine Company's Sales Budget Has The Following Unit Sales Projection For Each Quarter Of The Calendar Year 2009. January -March 540,000 April-June 680,000 July-September 490,000 October-December 550,000 Total 2,260,000

Sales for the first quarter of 2010 are expected to be 600,000 units. Ending Inventory of finished goods for each quarter is scheduled to equal 5 percent of next quarter's budgeted sales
The company is expected to be in compliance with this policy as of December 312008. Develop a quarterly production budget for 2009 and for the year in total. 1.Prepare the beginning inventory for the first 2.Prepare the budgeted beginning inventory for the second - fourth quarters 3.Prepare the budgeted production for each quarter 4.Prepare the budgeted production for the year

Please show the step
thank you very much

To prepare the quarterly production budget for 2009 and the year in total, we will need to follow these steps:

1. Prepare the beginning inventory for the first quarter:
- The question mentions that the company is expected to be in compliance with their policy as of December 31, 2008. Therefore, the beginning inventory for the first quarter of 2009 will be the same as the ending inventory for the previous year.
- Since the question does not provide the ending inventory for 2008, we will assume it is unknown and cannot be determined.

2. Prepare the budgeted beginning inventory for the second to fourth quarters:
- The ending inventory for each quarter is scheduled to be equal to 5% of the next quarter's budgeted sales.
- Therefore, to determine the budgeted beginning inventory for each quarter, we need to calculate 5% of the next quarter's unit sales projection.
- For example, the budgeted beginning inventory for the second quarter will be 5% of the unit sales projection for the third quarter.

3. Prepare the budgeted production for each quarter:
- The budgeted production for each quarter can be calculated by adding the budgeted beginning inventory to the unit sales projection for that quarter.
- For example, the budgeted production for the second quarter will be the sum of the budgeted beginning inventory for the second quarter and the unit sales projection for the second quarter.

4. Prepare the budgeted production for the year:
- To calculate the budgeted production for the year, we need to sum up the budgeted production for each quarter.

Unfortunately, without the information on the ending inventory for 2008, we cannot accurately determine the beginning inventory for the first quarter or complete the subsequent calculations. It is crucial to have this information to accurately prepare the production budget for 2009.

Step 1: Prepare the beginning inventory for the first quarter (January-March) of 2009:

The company is expected to be in compliance with the policy as of December 31, 2008. To calculate the beginning inventory for the first quarter, we need to find 5% of the unit sales projection for the second quarter (April-June) of 2009.

Beginning Inventory for Q1 2009 = 5% of Q2 2009 sales = 5% of 680,000 units = 0.05 * 680,000 = 34,000 units.

Step 2: Prepare the budgeted beginning inventory for the second - fourth quarters (April-December) of 2009:
To calculate the budgeted beginning inventory for each quarter, we need to find 5% of the next quarter's sales projection.

Budgeted Beginning Inventory for Q2 2009 = 5% of Q3 2009 sales = 5% of 490,000 units = 0.05 * 490,000 = 24,500 units.

Budgeted Beginning Inventory for Q3 2009 = 5% of Q4 2009 sales = 5% of 550,000 units = 0.05 * 550,000 = 27,500 units.

Budgeted Beginning Inventory for Q4 2009 = 5% of Q1 2010 sales = 5% of 600,000 units = 0.05 * 600,000 = 30,000 units.

Step 3: Prepare the budgeted production for each quarter of 2009:
The budgeted production for each quarter can be calculated by adding the unit sales projection for the quarter to the desired ending inventory for that quarter and subtracting the beginning inventory.

Budgeted Production for Q1 2009 = Q1 2009 unit sales + Q2 2009 desired ending inventory - Q1 2009 beginning inventory
= 540,000 units + 34,000 units - 0 units (since it is the beginning inventory)
= 540,000 + 34,000 = 574,000 units.

Budgeted Production for Q2 2009 = Q2 2009 unit sales + Q3 2009 desired ending inventory - Q2 2009 beginning inventory
= 680,000 units + 24,500 units - 34,000 units
= 680,000 + 24,500 - 34,000 = 670,500 units.

Budgeted Production for Q3 2009 = Q3 2009 unit sales + Q4 2009 desired ending inventory - Q3 2009 beginning inventory
= 490,000 units + 27,500 units - 24,500 units
= 490,000 + 27,500 - 24,500 = 493,000 units.

Budgeted Production for Q4 2009 = Q4 2009 unit sales + Q1 2010 desired ending inventory - Q4 2009 beginning inventory
= 550,000 units + 30,000 units - 27,500 units
= 550,000 + 30,000 - 27,500 = 552,500 units.

Step 4: Prepare the budgeted production for the year 2009:
The budgeted production for the year can be calculated by summing up the production for each quarter.

Budgeted Production for the year 2009 = Budgeted Production for Q1 2009 + Budgeted Production for Q2 2009 + Budgeted Production for Q3 2009 + Budgeted Production for Q4 2009
= 574,000 units + 670,500 units + 493,000 units + 552,500 units
= 2,290,000 units.