Question
The Volt Battery Company has forecast its sales in units as follows: January 3,200 February 3,050 March 3,000 April 3,500 May 3,750 June 3,900 July
The Volt Battery Company has forecast its sales in units as follows:
January | 3,200 |
February | 3,050 |
March | 3,000 |
April | 3,500 |
May | 3,750 |
June | 3,900 |
July | 3,600 |
Volt Battery always keeps an ending inventory equal to 140 percent of the next months expected sales. The ending inventory for December (Januarys beginning inventory) is 4,480 units, which is consistent with this policy. Materials cost $15 per unit and are paid for in the month after purchase. Labor cost is $8 per unit and is paid in the month the cost is incurred. Overhead costs are $18,000 per month. Interest of $10,400 is scheduled to be paid in March, and employee bonuses of $15,600 will be paid in June. a. Prepare a monthly production schedule for January through June.
b. Prepare a monthly summary of cash payments for January through June. Volt Battery produced 3,000 units in December.
Volt Battery always keeps an ending imventory equal to 140 percent of the next month's expected sales. The ending inventory for December (January's beginning inventory) is 4,460 units, which is consistent with this policy. Materlals cost $15 per unit and are paid for in the month after purchase. Labor cost is $8 per unit and is paid in the month the cost is incurred. Overhead costs are $18,000 per month. Interest of $10,400 is scheduled to be paid in March, and employee bonuses of $15,600 will be paid in June. a. Prepare a monthly preduction schedule for Jenuary through June
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