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The production department of Zan Corporation has submitted the following forecast of units to be produced by quarter for the upcomng fiscal year: In addition,
The production department of Zan Corporation has submitted the following forecast of units to be produced by quarter for the upcomng fiscal year: In addition, 6,000 grams of raw materlals Inventory is on hand at the start of the 1st Quarter and the beginning accounts payable for the 1st Quarter is $5,000. Each unit requires 4 grams of raw materlal that costs $1.40 per gram. Management desires to end each quarter with an Inventory of raw materlals equal to 25% of the following quarter's production needs. The desired ending Inventory for the 4 th Quarter Is 7,000 grams. Management plans to pay for 60% of raw materlal purchases in the quarter acqulred and 40% In the following quarter. Each unlt requires 0.40 direct labor-hours and direct laborers are pald $12.50 per hour. Required: 1. and 2. Calculate the estimated grams of raw materlal that need to be purchased and the cost of raw materlal purchases for each quarter and for the year as a whole. 3. Calculate the expected cash disbursements for purchases of materlals for each quarter and for the year as a whole. 4. Calculate the estimated direct labor cost for each quarter and for the year as a whole
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