Loose Leaf for Foundations of Financial Management Format: Loose-leaf
17th Edition
ISBN: 9781260464924
Author: BLOCK
Publisher: Mcgraw Hill Publishers
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Chapter 4, Problem 23P
The Volt Battery Company has
Volt Battery 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 1,460 units, which is consistent with this policy.
Materials cost
Prepare a monthly production schedule and a monthly summary of cash payments for January through June. Volt produced 1,100 units in December.
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The Volt Battery Company has forecast its sales in units as follows:
January
February
March
April
May
June
July
1,000
850
800
1,300
1,550
1,700
1,400
Volt Battery always keeps an ending inventory equal to 120 percent of the next month's expected sales. The ending inventory for
December (January's beginning inventory) is 1,200 units, which is consistent with this policy.
Materials cost $11 per unit and are paid for in the month after purchase. Labor cost is $4 per unit and is paid in the month the cost is
incurred. Overhead costs are $7,000 per month. Interest of $8,200 is scheduled to be paid in March, and employee bonuses of
$13,400 will be paid in June.
a. Prepare a monthly production schedule for January through June.
Note: Input all amounts as positive values except Beginning Inventory values under Production Schedule which should be
entered with a minus sign. Leave no cells blank be certain to enter O wherever required.
Projected unit sales
Desired ending inventory
Total units…
Croy Inc. has the following projected sales for the next five months:
Month
Sales in Units
April
3,850
May
3,875
June
4,260
July
4,135
August
3,590
Croy’s finished goods inventory policy is to have 60 percent of the next month’s sales on hand at the end of each month. Direct materials cost $3.10 per pound, and each unit requires 2 pounds. Direct materials inventory policy is to have 50 percent of the next month’s production needs on hand at the end of each month. Direct materials on hand at March 31 totaled 3,865 pounds. Required: 1. Determine budgeted production for April, May, and June.2. Determine budgeted cost of materials purchased for April and May.
Croy Inc. has the following projected sales for the next five months:
Month
Sales in Units
April
3,850
May
3,875
June
4,260
July
4,135
August
3,590
Croy’s finished goods inventory policy is to have 60 percent of the next month’s sales on hand at the end of each month. Direct materials cost $3.10 per pound, and each unit requires 2 pounds. Direct materials inventory policy is to have 50 percent of the next month’s production needs on hand at the end of each month. Direct materials on hand at March 31 totaled 3,865 pounds. Required: 1. Determine budgeted production for April, May, and June.2. Determine budgeted cost of materials purchased for April and May. (round answers to 2 decimal places)
Chapter 4 Solutions
Loose Leaf for Foundations of Financial Management Format: Loose-leaf
Ch. 4 - What are the basic benefits and purposes of...Ch. 4 - Explain how the collections and purchases...Ch. 4 - With inflation, what are the implications of using...Ch. 4 - Explain the relationship between inventory...Ch. 4 - Prob. 5DQCh. 4 - Discuss the advantage and disadvantage of level...Ch. 4 - What conditions would help make a percent-of-sales...Ch. 4 - Prob. 1PCh. 4 - Philip Morris expects the sales for his clothing...Ch. 4 - Galehouse Gas Stations Inc. expects sales to...
Ch. 4 - The Alliance Corp. expects to sell the following...Ch. 4 - Prob. 5PCh. 4 - Cyber Security Systems had sales of 3,500 units at...Ch. 4 - Dodge Ball Bearings had sales of 15,000 units at...Ch. 4 - Sales for Ross Pro’s Sports Equipment are expected...Ch. 4 - Vitale Hair Spray had sales of 13,000 units in...Ch. 4 - Delsing Plumbing Company has beginning inventory...Ch. 4 - On December 31 of last year, Wolfson Corporation...Ch. 4 - At the end of January, Higgins Data Systems had an...Ch. 4 - At the end of January, Mineral Labs had an...Ch. 4 - Convex Mechanical Supplies produces a product with...Ch. 4 - The Bradley Corporation produces a product with...Ch. 4 - Sprint Shoes Inc. had a beginning inventory of...Ch. 4 - J. Lo’s Clothiers has forecast credit sales for...Ch. 4 - Simpson Glove Company has made the following sales...Ch. 4 - Watt’s Lighting Stores made the following sales...Ch. 4 - Ultravision Inc. anticipates sales of $290,000...Ch. 4 - The Denver Corporation has forecast the following...Ch. 4 - Wright Lighting Fixtures forecasts its sales in...Ch. 4 - The Volt Battery Company has forecast its sales in...Ch. 4 - Graham Potato Company has projected sales of...Ch. 4 - Harry’s Carryout Stores has eight locations. The...Ch. 4 - Archer Electronics Company’s actual sales and...Ch. 4 - Prob. 27PCh. 4 - The Manning Company has financial statements as...Ch. 4 - Conn Man’s Shops, a national clothing chain, had...
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