Journey's Umbrella Factory • Sales Forecast for Q4 in 2022: Selling price = $20 per umbrella o October 20,000 units • November 22,000 units o December 25,000 units o January 23 21,000 units • Journey's will begin Q4 with 28,000 units in finished goods (FG) • Journey's wants to end each month with 120% of the next month's projected sales in finished goodsinventory • Each umbrella requires 5 lbs. of direct material • Direct material costs $2.00 per lb. • Journey's will begin the 4th quarter with 10,000 lbs. of direct materials but would like o 20,000 lbs. of direct materials at the end of October, • 35,000 lbs. of direct materials at the end of November, and • 40,000 lbs. of direct materials at the end of December. • It takes 12 minutes of direct labor hours to make one umbrella • Workers earn $12 per hour Use the above information to answer the question below. QUESTION: How many pounds of direct materials will be used in production for the month of October? O 35,000 pounds O 128,000 pounds O 163,000 pounds O 92,000 pounds
Journey's Umbrella Factory • Sales Forecast for Q4 in 2022: Selling price = $20 per umbrella o October 20,000 units • November 22,000 units o December 25,000 units o January 23 21,000 units • Journey's will begin Q4 with 28,000 units in finished goods (FG) • Journey's wants to end each month with 120% of the next month's projected sales in finished goodsinventory • Each umbrella requires 5 lbs. of direct material • Direct material costs $2.00 per lb. • Journey's will begin the 4th quarter with 10,000 lbs. of direct materials but would like o 20,000 lbs. of direct materials at the end of October, • 35,000 lbs. of direct materials at the end of November, and • 40,000 lbs. of direct materials at the end of December. • It takes 12 minutes of direct labor hours to make one umbrella • Workers earn $12 per hour Use the above information to answer the question below. QUESTION: How many pounds of direct materials will be used in production for the month of October? O 35,000 pounds O 128,000 pounds O 163,000 pounds O 92,000 pounds
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Journey's Umbrella Factory
• Sales Forecast for Q4 in 2022: Selling price = $20 per umbrella
o October 20,000 units
o November 22,000 units
o December 25,000 units
o January '23 21,000 units
Journey's will begin Q4 with 28,000 units in finished goods (FG)
Journey's wants to end each month with 120% of the next month's projected sales in finished goodsinventory
●
• Each umbrella requires 5 lbs. of direct material
• Direct material costs $2.00 per lb.
Journey's will begin the 4th quarter with 10,000 lbs. of direct materials but would like
• 20,000 lbs. of direct materials at the end of October,
●
o 35,000 lbs. of direct materials at the end of November, and
o 40,000 lbs. of direct
aterials at the end of December.
• It takes 12 minutes of direct labor hours to make one umbrella
• Workers earn $12 per hour
Use the above information to answer the question below.
QUESTION: How many pounds of direct materials will be used in production for the month of October?
O 35,000 pounds
O 128,000 pounds
O 163,000 pounds
O 92,000 pounds
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