11. Wilmer Company produces two products: OldX and NewX. Budgeted sales for four months are as follows:

Old X New X May 10,000 40,000 June 20,000 70,000 July 15,000 80,000 August 30,000 90,000

Wilmer's ending inventory policy is that OldX should have 10% of next month's sales in ending inventory and NewX should have 20% of next month's sales in ending inventory. On May 1, there were 1,000 units of OldX and 9,000 units of NewX.

NewX requires 4 units of component A. (OldX does not use component A.) There were 2,100 units of component A in inventory on May 1. Wilmer wants to have 30 percent of the following month's production needs in inventory for Component A.

What is the budgeted amount of component A to be purchased in May?

a.

66,600

b.

64,500

c.

288,000

d.

264,300

e.

180,000

12. Wilmer Company produces two products: OldX and NewX. Budgeted sales for four months are as follows: Old X New X May 10,000 40,000 June 20,000 70,000 July 15,000 80,000 August 30,000 90,000

Wilmer's ending inventory policy is that OldX should have 10% of next month's sales in ending inventory and NewX should have 20% of next month's sales in ending inventory. On May 1, there were 1,000 units of OldX and 9,000 units of NewX.

NewX requires 4 units of component A. (OldX does not use component A.) There were 2,100 units of component A in inventory on May 1. Wilmer wants to have 30 percent of the following month's production needs in inventory for Component A.

What is the desired ending inventory of component A for May?

a.

180,000

b.

2,100

c.

72,000

d.

86,400

e.

58,500