Tough Jeans Company produces two different styles of jeans: Working Life and Social Life. The company sales budget estimates that 400,000 of the Working Life jeans and 250,000 of the Social Life jeans will be sold during the year. The company begins with 9,000 pairs of Working Life and 18,000 pairs of Social Life. The company desires ending inventory of 7,500 of Working Life and 10,000 Social Life. Prepare a production budget for the year.

Production Budget

A financial plan for the manufacturing departments detailing the quantity of each product to be produced and the resources required.

Sales Budget

An estimation of future sales revenues, often broken down by month or quarter, used for planning and operational purposes.

Ending Inventory

Ending Inventory is the total value of goods available for sale at the end of an accounting period, calculated by adding purchases to beginning inventory and subtracting goods sold.