Osage Inc. has actual sales for May and June and forecast sales for July, August, September, and October as follows:

Actual:
May	5,870	units
June	6,220	units
Forecast:
July	5,960	units
August	6,750	units
September	5,600	units
October	5,360	units

Required:
a. The company's policy is to have an inventory of finished goods available at the end of the month equal to 80% of the next month's sales. It is currently estimated that there will be 4,768 units available by the end of June. Calculate the number of units to be produced in each of the months of July, August and September.

b. Each unit of finished product requires 7 pounds of raw materials. Company policy is to have raw material inventory on hand at the end of each month that is equal to 45% of the next month's estimated usage. It is currently estimated that 25,700 pounds of raw materials will be available by the end of June. Calculate the number of pounds of raw materials that will be purchased in each of the months of July and August.

Answer rating: 100% (QA)

a To calculate the number of units to be produced in each of the months of July August and September ... View the full answer