Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Madison last month (December) sales were 10,000 units @ $40. The company estimates an increase of 1.5% in sales for January. An increase of 200

Madison last month (December) sales were 10,000 units @ $40. The company estimates an increase of 1.5% in sales for January. An increase of 200 units for February (compared to January) and a reduction of 100 units for March (compared to February). The selling price is not expected to change. April sales projections are a 5% increase from December sales.

INVENTORY POLICY

FINISHED GOODS maintain an ending inventory equal to 25% of next month sales

December finished goods ending inventory was 6,000 units

Direct materials-maintain an ending inventory equal to 35% of next month production April production is estimated at 20,000

-Material cost is $10 per pound. Each unit requires .25 pounds of materials and actual inventory is 1500 pounds

-Labor cost is $14 per hour in each unit requires 30 minutes of labor

-Fixed overhead is 62,517 monthly and variable overhead is 120% of direct labor cost

Calculate materials to be purchased in March

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cost Accounting Principles And Applications

Authors: Horace R. Brock, Linda Herrington

6th Edition

0028034287, 978-0028034287

Students also viewed these Accounting questions

Question

Find the product (x + 3) (x + 4) (x + 2).

Answered: 1 week ago

Question

Am I surfing to avoid feelings of loneliness, stress, or a nger?

Answered: 1 week ago

Question

The value of a firm can increase, in theory, when the firm accepts,

Answered: 1 week ago