Fair Score Company Production Budget for Year 2023

What factors need to be considered in creating a production budget for Fair Score Company?

1. Sales forecast

2. Inventory levels

3. Production capacity

Factors to Consider in Creating a Production Budget

In creating a production budget for Fair Score Company, several factors need to be taken into consideration:

A production budget is a financial plan that outlines the number of units a company plans to produce during a specific period. It is crucial for Fair Score Company to consider the following factors:

1. Sales Forecast: Fair Score Company should estimate the number of scoreboards it expects to sell in the year 2023 based on historical sales data, market trends, and customer demand.
2. Inventory Levels: Analyzing current inventory levels will help determine production requirements by subtracting beginning inventory from desired ending inventory.
3. Production Capacity: Assessing production capacity considering available resources, labor, and equipment is essential to determine the maximum number of scoreboards that can be produced.

By calculating the desired ending inventory, expected sales, and beginning inventory, Fair Score Company can determine the number of scoreboards it needs to produce to meet sales forecast and maintain inventory levels.