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Henderson Company has developed the following standards for the production of one finished unit: Direct Materials, 4 pounds per unit @ $5 per pound Direct
Henderson Company has developed the following standards for the production of one finished unit: Direct Materials, 4 pounds per unit @ $5 per pound Direct Labor, 3 hours per unit @ S9 per labor hour Variable Overhead, 5 machine hours per unit @ S8 per machine hour Fixed Overhead costs are expected to be S174,750 per quarter. The expected selling price per unit is $160. Quarterly sales for 2018 are expected to be as follows: Quarter 1 5,000 units; Quarter 2 8,000 units; Quarter 3-6,000 units; and Quarter 4-4,000 units. The sales in the first quarter of the year 2019 are expected to be 6,000 units Management would like to maintain a finished goods inventory equal to 30% of the next quarter's sales. The beginning finished goods inventory on January 1, 2018 is expected to follow this same pattern. Management would like to maintain a raw materials inventory equal to 40% of the next quarter's material requirements. The beginning raw materials inventory on January 1, 2018 is expected to follow the same pattern
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