Question
Ruiz Co. provides the following sales forecast for the next four months: April May June July Sales (units) 640 720 670 760 The company wants
Ruiz Co. provides the following sales forecast for the next four months: April May June July Sales (units) 640 720 670 760 The company wants to end each month with ending finished goods inventory equal to 30% of next month's forecasted sales. Finished goods inventory on April 1 is 192 units. Assume July's budgeted production is 670 units. In addition, each finished unit requires four pounds (lbs.) of raw materials and the company wants to end each month with raw materials inventory equal to 30% of next months production needs. Beginning raw materials inventory for April was 797 pounds. Assume direct materials cost $4 per pound.
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