Denton Company manufactures three products (A, B, and C) from three raw materials (X, Y, and...

 

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Denton Company manufactures three products (A, B, and C) from three raw materials (X, Y, and Z). The following table indicates the number of pounds of each material that is required to manufacture each type of product: Material Z 2 2 Product Material X Material Y 2 A B с The company has a policy of maintaining an inventory of finished goods on all three products equal to 25% of the next month's budgeted sales. Unit costs of materials X, Y. and Z are respectively $4, 53, and $5. Denton Company has a policy of maintaining its raw material inventories at 50% of the next month's production needs. Listed below is the sales budget for the first quarter of the current year: Month Product A Product B Product C 12,000 8,000 10,000 Jan 10,000 Feb. 9,000 Mar. 11,000 3 2 3 1 2 11,000 12,000 10,000 Selling prices for products A, B. and C are $120, $140, and $150. Monthly sales for Denton are 25% on cash and the rest on account. Of those sold on account, Denton gives a 5% discount if the account is settled in the month of sale, and a 2% discount if the account is settled in the month following the sale. Expected collection pattem from customers on account are as follows: Month of sale 40% 1st month after the sale 30% 2nd month after the sale 20% 3rd month after the sale 5% Uncollectible 5% Denton has accelerated the collection of receivables in December of last year because it had a long-term obligation maturing on December 31 of the same year. Because of this, Denton has collected all but $200,000 of accounts, 60% of which were sold in November and 40% in December. Collection for these accounts are expected to follow the normal collection pattern of Denton. 1. How many units of each product must Denton produce during January and February? (1 point each) 2. How many pounds of each material must Danton purchase in January? (1 point each) 3. How much is the budgeted purchases for each material in January? (2 points each) 4. How much is Denton's budgeted monthly cash receipts for January to March? (2 points each) Denton Company manufactures three products (A, B, and C) from three raw materials (X, Y, and Z). The following table indicates the number of pounds of each material that is required to manufacture each type of product: Material Z 2 2 Product Material X Material Y 2 A B с The company has a policy of maintaining an inventory of finished goods on all three products equal to 25% of the next month's budgeted sales. Unit costs of materials X, Y. and Z are respectively $4, 53, and $5. Denton Company has a policy of maintaining its raw material inventories at 50% of the next month's production needs. Listed below is the sales budget for the first quarter of the current year: Month Product A Product B Product C 12,000 8,000 10,000 Jan 10,000 Feb. 9,000 Mar. 11,000 3 2 3 1 2 11,000 12,000 10,000 Selling prices for products A, B. and C are $120, $140, and $150. Monthly sales for Denton are 25% on cash and the rest on account. Of those sold on account, Denton gives a 5% discount if the account is settled in the month of sale, and a 2% discount if the account is settled in the month following the sale. Expected collection pattem from customers on account are as follows: Month of sale 40% 1st month after the sale 30% 2nd month after the sale 20% 3rd month after the sale 5% Uncollectible 5% Denton has accelerated the collection of receivables in December of last year because it had a long-term obligation maturing on December 31 of the same year. Because of this, Denton has collected all but $200,000 of accounts, 60% of which were sold in November and 40% in December. Collection for these accounts are expected to follow the normal collection pattern of Denton. 1. How many units of each product must Denton produce during January and February? (1 point each) 2. How many pounds of each material must Danton purchase in January? (1 point each) 3. How much is the budgeted purchases for each material in January? (2 points each) 4. How much is Denton's budgeted monthly cash receipts for January to March? (2 points each)

Answer rating: 100% (QA)

Solution1 WN1 Production BudgetProduct A Sales Units AddClosing Stock ... View the full answer