Fictional budget and stock movements

A fictional producer budgets sales of1000units for one month. It begins with100finished units and wants150finished units at the end. Each newly produced unit requires two kilograms of material. The material store begins with200kilograms and wants300at the end. Material costs four currency units per kilogram under the supplied purchase assumptions. A planner confuses sales with production and also deducts the desired closing material stock. The exercise uses no losses, work in progress, purchase discounts or tax. Learners must distinguish the two stock-flow reconciliations, calculate purchases and explain how the assumptions would need changing if rejects, delayed deliveries or safety-stock constraints were introduced. It is a planning illustration rather than an instruction that actual stock policy is optimal.