Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Sit-Down Ltd manufactures chairs. Each chair requires 425 grams of plastic costing $0.34 per 10 grams. Sit-Down uses the plastic to cover the chairs. Sit-Down
Sit-Down Ltd manufactures chairs. Each chair requires 425 grams of plastic costing $0.34 | |||||
per 10 grams. Sit-Down uses the plastic to cover the chairs. Sit-Down has budgeted | |||||
production of chairs for the next four months as follows: | |||||
Units | |||||
March | 3,500 | ||||
April | 4,400 | ||||
May | 4,900 | ||||
June | 6,300 | ||||
Inventory policy requires that sufficent plastic be in ending monthly inventory to satisfy | |||||
20 percent of the following month's production needs. The inventory of plastic at the | |||||
beginning of March equals exactly the amount needed to satisfy the inventory policy. |
The total materials to be purchased (grams) for March, April and May is
a. | 5,440,000 | |
b. | 5,678,000 | |
c. | 5,990,000 | |
d. | 5,100,000 |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started