Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Production cash outflow. National Beverage Company produces its products two months in advance of anticipated sales and ships to warehouse centers the month before sale.

image text in transcribed

Production cash outflow. National Beverage Company produces its products two months in advance of anticipated sales and ships to warehouse centers the month before sale. The inventory safety stock is 9% of the anticipated month's sale. Beginning inventory in October 2014 was 260,895 units. Each unit costs $0.25 to make. The average selling price is $0.67 per unit. The cost is made up of 38% labor, 54% materials, and 8% shipping (to the warehouse). The company pays for labor the month of production, shipping the month after production, and raw materials the month prior to production. What is the production cash outflow for products produced in the month of October 2014, and in what months does it occur? Note: October production is based on December anticipated sales. The fourth-quarter sales forecasts are as follows: $1,839,000 (October), $2,059,000 (November), and $2,216,000 (December). What is the production cash outflow for the month of October 2014 production? (Hint: The production cost comprises labor, raw materials, and shipping.) The labor cost is $. (Round to the nearest dollar.)

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

College Accounting A Practical Approach

Authors: Jeffrey Slater, Debra Good

14th Canadian Edition

0135222419, 978-0135222416

More Books

Students also viewed these Accounting questions

Question

Know why employees turn to unions

Answered: 1 week ago

Question

Understand the process of effective succession planning

Answered: 1 week ago

Question

Understand the history of unionization

Answered: 1 week ago