Manufacturing Inventories Bronze Manufacturing developed patents on several information transmission relays and has been producing and selling the relays for the past six years. At the end of 2000, Bronze reported the following inventory balances:

It takes Bronze approximately seven working days to complete the relays from the time they are put into production.
For the year 2000, Bronze Manufacturing reported sales of $1,400,000, with 65 percent of the sales occurring in the third quarter of the year. Total cost of goods sold for 2000, was $720,000.

a. What is the difference between raw materials inventory and the production supplies inventory? What dangers are there in having excess raw materials inventory?

b. What amount of Bronze’s inventory is available for shipment on December 31, 2000?

c. What dangers are there in having excess finished goods inventory?

d. What factors should be examined in judging the adequacy of the finished goods inventory at December 31, 2000?
Does Bronze appear to have an appropriate amount of finished goods inventory on hand at December 31, 2000? Explain your answer.

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Finished goods Work-in-process Raw materials Production supplies Total $450,000 140,000 225,000 85,000 $900,000