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Consider the following information. Each unit sells for $400. Regular production and overtime production costs are $250 and $350 per unit, respectively. The cost
Consider the following information. Each unit sells for $400. Regular production and overtime production costs are $250 and $350 per unit, respectively. The cost to hold a unit in inventory for one month is $40. Click the icon to view the production information. a. Develop a cash flow analysis for this problem. Fill in the table below (enter your responses as whole numbers and include a minus sign if necessary). Month Forecasted sales Regular Overtime Ending production production inventory January 1,000 1,350 0 350 Cash inflows $ 400000 Cash outflows Net flows Cumulative net flows $ February 1,200 1,350 0 500 $ 480000 $ March 1,400 1,350 0 450 $ 560000 $ $ April 1,600 1,350 0 200 $640000 May June 1,800 1,700 1,350 250 0 $ 720000 $ $ 1,350 250 0 $680000 b. Why do the net cash flows for April and May look so much better than those for the other months? What are the implications for building up and draining down inventories under a level production plan? The net cash flows for April and May are much higher than the other months because the number of units sold is much 7, although inventory costs may be high. building up and draining down inventory are that the production costs than the number of units produced. The implications of
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