Kosar Manufacturing has collected the following information on one of its major products. Most efficient production rate
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Question:
Kosar Manufacturing has collected the following information on one of its major products.
Most efficient production rate = 2,000 + X units per period
Production change costs = $20 per unit of change (from 2,000 + X units/period)
Inventory costs = $5 per unit per period (on closing inventory balance)
Back order costs = $10 per unit to carry demand into next period
Beginning inventory = 400 units
x=400
Period | Demand (units) |
1 | 3,000 + X |
2 | 2300 |
3 | 1,800 + X |
4 | 2800 |
5 | 2,000 + X |
6 | 2,300 |
1. Calculate a level production schedule that yields X inventory at the end of period VI.
2. What is the total cost of this solution? What is the total inventory cost of this solution?
Related Book For
Cornerstones of Managerial Accounting
ISBN: 978-0324660135
3rd Edition
Authors: Mowen, Hansen, Heitger
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