Barrington Bears has developed the following sales forecasts for the next few months.January 500, February 600, March 720, April 800 and May 770. BB has 80 bears on hand on Dec. 31. Normal ending inventory policy is to hold 20% of next months sales. Each bear needs 0.8 yards of fabric and two pounds of stuffing.Fabric is budgeted to cost $15 per yard and stuffing $4 per pound. Direct labor is paid $18 per hour. Each bear takes 40 minutes to hand-finish. Variable overhead totals $21 per direct labor hour. Fixed overhead amounts to $25,000 per month. Eighty yards of fabric and 100 pounds of stuffing were in stock at year-end. Ten percent and 25% of next months stuffing and fabric needs respectively are planned for raw materials ending inventory each month. How many bears must be produced in February?

Multiple Choice

600

540

624

744

None of the choices are correct