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please find attachment and solve question as soon as possible Assignment 6 Profit Planning (Note: choose between 1 and 2. On the other hand 3
please find attachment and solve question as soon as possible
Assignment 6 Profit Planning (Note: choose between 1 and 2. On the other hand 3 is compulsory) 1. Scot Company plans to sell 400,000 units of finished product in July 20x1. Management (1) anticipates a growth rate in sales of 5% per month thereafter and (2) desires a monthly ending finished-goods inventory (in units) of 80% of the following month's estimated sales. There are 300,000 completed units in the June 30, 20x1 inventory. Each unit of finished product requires four pounds of direct material at a cost of $1.50 per pound. There are 1,600,000 pounds of direct material in inventory on June 30, 20x1. Required: A. Prepare a production budget for the quarter ended September 30, 20x1. Note: For both part "A" and part "B" of this problem, prepare your budget on a quarterly (not monthly) basis. B. Independent of your answer to part "A," assume that Scot plans to produce 1,200,000 units of finished product for the quarter ended September 30. If the firm desires to stock direct materials at the end of this period equal to 25% of current production usage, compute the cost of direct material purchases for this quarter. 2. Jacobs manufactures two products: A and B. The firm predicts a sales volume of 10,000 units for product A and ending finished-goods inventory of 2,000 units. These numbers for product B are 12,000 and 3,000, respectively. Jacobs currently has 7,000 units of A in inventory and 9,000 units of B. The following raw materials are required to manufacture these products: Raw Material X Y Z Cost per Pound $2.00 2.50 1.25 Required for Product A B 2 pounds 1 pound 1 pound 3 pounds Product A requires three hours of cutting time and two hours of finishing time; B requires one hour and three hours, respectively. The direct labor rate for cutting is $10 per hour and $18 per hour for finishing. Required: A. Prepare a production budget in units. B. Prepare a materials usage budget in pounds and dollars. C. Prepare a direct labor budget in hours and dollars for product A. 3. Tara Company has the following historical collection pattern for its credit sales: 70% collected in month of sale 15% collected in the first month after sale 10% collected in the second month after sale 4% collected in the third month after sale 1% uncollectible Budgeted credit sales for the last six months of 20x1 follow. July August September October November December $30,000 35,000 40,000 45,000 50,000 42,500 Required: A. Calculate the estimated total cash collections during October. B. Calculate the estimated total cash collections during the year's fourth quarterStep by Step Solution
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