The Boswell Corporation forecasts its sales in units for the next four months as follows: March..6,000 April8,000
Question:
The Boswell Corporation forecasts its sales in units for the next four months as follows:
March…………………………………………………..6,000
April……………………………………………………8,000
May…………………………………………………….5,500
June…………………………………………………….4,000
Boswell maintains an ending inventory for each month in the amount of two and one-half times the expected sales in the following month. The ending inventory for February (March's beginning inventory) reflects this policy. Materials cost $7 per unit and are paid for in the month after production. Labor cost is $11 per unit and is paid for in the month incurred. Fixed overhead is $21,500 per month. Dividends of $21,900 are to be paid in May. Twenty four thousand units were produced in February.
Complete a production schedule and a summary of cash payments for March, April, and May. Remember that production in any one month is equal to sales plus desired ending inventory minus beginning inventory.
Real Estate Finance and Investments
ISBN: 978-0073377339
14th edition
Authors: William Brueggeman, Jeffrey Fisher