1.) What are the total regular production costs?2.) What are the overtime production costs?3.) What is the inventory holding cost when the holding cost for one unit for a month is$1 if you were to use the ending inventory method?4.) What is the inventory holding cost if you were to use the average inventory level method? 1. General Food Stuffs packages a variety of breakfast cereals and snack bars, which itaggregates as simply units of sale when doing medium-term planning.General FoodStuffs has created the following aggregate plan for the next 6 months:Month 1Month 2Month 3Month 4Month 5Month 6Forecast20,00040,00020,00010,0005,00020,000(units ofsale)Overall30,00045,0005,00015,00020,000ProductionEndingInventoryRegularTimeProductionOvertimeProductionGeneral Food Stuffs can produce up to 25,000 units of sale a month in regular time, whenproduction costs are only $2.50 per unit of sale. When General Foods Stuffs plansto exceed30,000 units of sale produced in a single month, all units of sale in excess of 30,000 must beproduced in overtime production at a cost of $3.50 per unit of sale.General Food Stuffs actually has 5,000 units of sale available in inventory at the start ofmonth 1.

Name: 1.) What are the total regular production costs?2.) What are the overt
Uploaded: 2024-03-20T06:32:37.000Z
Channel: Bartleby
Description: 1.) What are the total regular production costs?2.) What are the overtime production costs?3.) What is the inventory holding cost when the holding cost for one unit for a month is$1 if you were to use the ending inventory method?4.) What is the inven

*As per bartleby guidelines in case of interlinked answer, first 3 only 1) Calculation of Regular production cost Particulars Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Production 30000 45000 5000 15000 0 25000 Regular production Cost ( 2.50 x production till 30000 ) $75000 $112500 $12500 $37500 - $62500 1) Calculation of Overtime Production Cost Particulars Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Production 30000 45000 5000 15000 0 25000 Overtime production ( Excess of 30000 ) - 15000 - - - - Overtime production cost = 1$ per unit of sale (3.5-2.5) Overtime Production cost ( in excess of 30000) = (45000 - 30000) x 1 = $150003) Calculation of Ending Inventory and Holding Cost Particulars Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Opening Inventory 5000 15000 20000 5000 10000 5000 Production 30000 45000 5000 15000 0 25000 Less: Sales 20000 40000 20000 10000 5000 20000 Ending Inventory 15000 20000 5000 10000 5000 10000 Holding cost per unit ( $1) ( Ending Inventory x Holding cost ) $15000 $20000 $5000 $10000 $5000 $10000