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The Ace Battery Company has forecast its sales in units as follows: January February March 1,700 May 1,550 June 1,500 July 2,000 2,250 2,400 2,100
The Ace Battery Company has forecast its sales in units as follows: January February March 1,700 May 1,550 June 1,500 July 2,000 2,250 2,400 2,100 April Ace always keeps an ending inventory equal to 110 percent of the next month's expected sales. The ending inventory for December (January's beginning inventory) is 1,870 units, which is consistent with this policy. Materials cost $12 per unit and are paid for in the month after production. Labour cost is $5 per unit and is paid in the month the cost is incurred. Overhead costs are $10,500 per month. Interest of $8,900 is scheduled to be paid in March, and employee bonuses of $14,100 will be paid in June. a. Prepare a monthly production schedule for January through June. (Enter all values as positive value.) Ace Battery Company Production Schedule February March January April May June Forecasted unit sales Desired ending inventory Beginning inventory July Units to be produced b. Prepare a monthly summary of cash payments for January through June. Ace produced 1,500 units in December Ace Battery Company Summary of Cash payments February March December January April May June $ $ $ $ $ Units produced Material cost Labour cost Overhead cost Interest Employee bonuses Total cash payments $ $ $ $
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