Shalom Company manufactures Product Peace. Each unit requires 3 kilos of raw material at a cost...

 

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Shalom Company manufactures Product Peace. Each unit requires 3 kilos of raw material at a cost of P1.80 per kilo. The company's budget for second quarter and July production is shown below: April Units 12,000 May June 13,500 12,400 July 11,200 Starting April, Shalom wants to maintain several kilos of raw material as ending inventory equal to 15% of the following month's production needs. The company wanted to implement this since last quarter, there were instances of stockouts of raw materials. At the end of first quarter, only 3,000 kilos were available. Amounts must be in whole numbers. Example: 88,000 or (88,000) Format of units/kilos: 88,000 KILOS (in whole numbers, one space after the number of units) Words must be in capital letters. Compute the ending inventory. Shalom Company wants to maintain a minimum monthly cash balance of P20,000. The budget for the first quarter showed an ending cash balance of P21,000. In April, expected cash receipts are P288,000, and budgeted expenses, including depreciation of P30,000, are expected to be P321,000. Amounts must be in whole numbers. Example: 88,000 or (88,000) Should Shalom Company enter into a financing agreement? Yes or No? Use the underlined words in capital letters as your choice. Shalom Company manufactures Product Peace. Each unit requires 3 kilos of raw material at a cost of P1.80 per kilo. The company's budget for second quarter and July production is shown below: April Units 12,000 May June 13,500 12,400 July 11,200 Starting April, Shalom wants to maintain several kilos of raw material as ending inventory equal to 15% of the following month's production needs. The company wanted to implement this since last quarter, there were instances of stockouts of raw materials. At the end of first quarter, only 3,000 kilos were available. Amounts must be in whole numbers. Example: 88,000 or (88,000) Format of units/kilos: 88,000 KILOS (in whole numbers, one space after the number of units) Words must be in capital letters. Compute the ending inventory. Shalom Company wants to maintain a minimum monthly cash balance of P20,000. The budget for the first quarter showed an ending cash balance of P21,000. In April, expected cash receipts are P288,000, and budgeted expenses, including depreciation of P30,000, are expected to be P321,000. Amounts must be in whole numbers. Example: 88,000 or (88,000) Should Shalom Company enter into a financing agreement? Yes or No? Use the underlined words in capital letters as your choice.

Answer rating: 100% (QA)

To calculate the ending inventory and determine if Shalom Company should enter into a financing agreement lets first calculate the ending inventory and then evaluate the cash position for each month 1 ... View the full answer