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Front Page Video Games loves the work you did for them on their Last Spike video game facility so now they want you to do
Front Page Video Games loves the work you did for them on their Last Spike video game facility so now they want you to do an even more detailed analysis for a second manufacturing facility they are planning to run that will make a completely different game called First Spike. They want you to develop forecasts for 2022 using the following information. Forecast year Month Sales ($) Other Cash Payments Ending Cash Ending Inventory Units Units Produced 2021 November $ 14,000 2,083 December 28,000 $ 8,333 4,167 5,000 2022 January 280,000 $ 53,200 February 90,000 61,600 March 27,500 64,400 April 308,000 56,000 May 336,000 75,600 June 280,000 72,800 July 364,000 53,200 August 308,000 56,000 September 308,000 56,000 October 392,000 58,800 November 364,000 61,600 December 308,000 56,000 2023 January 280,000 61,600 Sale price per unit is: $ 23 Cost per unit is: 15 Cash flows for unit costs in any month is the cost per unit times the units produced in the prior month because all unit costs are purchased on account (Accounts Payable) in the month produced and paid in full the following month. Similarly, Other Cash Payments in a month are payments regarding other expenses purchased on account in the prior month. Front Page wants to keep its facility running with a level production policy but they realize this might not be entirely realistic. To save capital investment they are purchasing used equipment that will require extensive repairs and maintenance twice a year. This means that in June and December they will only be able to produce a maximum number of units of: 5,000 units First Spike sales are expected to be a mix of direct online cash sales and various distributors. The distributor's sales will all be on account. Cash receipts from distributor sales are expected to be received across the two months following the sale. Front Page expects cash receipts to be approximately: Cash sales 30% A/R from 1 month prior 65% A/R from 2 months prior 35% MARKS 20 a. Construct a monthly production and inventory schedule in units. Note: To do part a, you should work in terms of units of production and units of sales. 20 b. Prepare a monthly schedule of cash receipts. 20 c. Prepare a monthly schedule of cash payments.
| Front Page Video Games loves the work you did for them on their Last Spike video game facility so now they want you to | ||||||||
| do an even more detailed analysis for a second manufacturing facility they are planning to run that will make a completely different | ||||||||
| game called First Spike. | ||||||||
| They want you to develop forecasts for 2022 using the following information. | ||||||||
| Forecast year | Month | Sales ($) | Other Cash Payments | Ending Cash | Ending Inventory Units | Units Produced | ||
| 2021 | November | $ 14,000 | 2,083 | |||||
| December | 28,000 | $ 8,333 | 4,167 | 5,000 | ||||
| 2022 | January | 280,000 | $ 53,200 | |||||
| February | 90,000 | 61,600 | ||||||
| March | 27,500 | 64,400 | ||||||
| April | 308,000 | 56,000 | ||||||
| May | 336,000 | 75,600 | ||||||
| June | 280,000 | 72,800 | ||||||
| July | 364,000 | 53,200 | ||||||
| August | 308,000 | 56,000 | ||||||
| September | 308,000 | 56,000 | ||||||
| October | 392,000 | 58,800 | ||||||
| November | 364,000 | 61,600 | ||||||
| December | 308,000 | 56,000 | ||||||
| 2023 | January | 280,000 | 61,600 | |||||
| Sale price per unit is: | $ 23 | |||||||
| Cost per unit is: | 15 | |||||||
| Cash flows for unit costs in any month is the cost per unit times the units produced in the prior month because | ||||||||
| all unit costs are purchased on account (Accounts Payable) in the month produced and paid in full the following month. | ||||||||
| Similarly, Other Cash Payments in a month are payments regarding other expenses purchased on account in the prior month. | ||||||||
| Front Page wants to keep its facility running with a level production policy but they realize this might not be entirely realistic. | ||||||||
| To save capital investment they are purchasing used equipment that will require extensive repairs and | ||||||||
| maintenance twice a year. This means that in June and December they will only be able to produce a maximum | ||||||||
| number of units of: | 5,000 | units | ||||||
| First Spike sales are expected to be a mix of direct online cash sales and various distributors. The distributor's sales will | ||||||||
| all be on account. Cash receipts from distributor sales are expected to be received across the two months following the sale. | ||||||||
| Front Page expects cash receipts to be approximately: | ||||||||
| Cash sales | 30% | |||||||
| A/R from 1 month prior | 65% | |||||||
| A/R from 2 months prior | 35% | |||||||
| MARKS | ||||||||
| 20 | a. Construct a monthly production and inventory schedule in units. | |||||||
| Note: To do part a, you should work in terms of units of production and units of sales. | ||||||||
| 20 | b. Prepare a monthly schedule of cash receipts. | |||||||
| 20 | c. Prepare a monthly schedule of cash payments. | |||||||
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Inquiry into Physics
Authors: Vern J. Ostdiek, Donald J. Bord
8th edition
1305959426, 9781337515863 , 978-1305959422
