The Volt Battery Company has forecast its sales in units as follows: January February March April May June July 1,000 850 888 1,300 1,550 1,700 1,480 Volt Battery always keeps an ending inventory equal to 120 percent of the next month's expected sales. The ending inventory for December (January's beginning inventory) is 1,200 units, which is consistent with this policy. Materials cost $11 per unit and are paid for in the month after purchase. Labor cost is $4 per unit and is paid in the month the cost incurred. Overhead costs are $7,000 per month. Interest of $8,200 is scheduled to be paid in March, and employee bonuses of $13,400 will be paid in June. a. Prepare a monthly production schedule for January through June. Note: Input all amounts as positive values except Beginning Inventory values under Production Schedule which should be entered with a minus sign. Leave no cells blank be certain to enter O wherever required. Projected unit sales Desired ending inventory Total units required Beginning inventory Units to be produced January Units produced Material cost Labor cost Overhead cost Interest Employee bonuses Total cash payments 0 December 0 Volt Battery Company Production Schedule March February S January 0 0 0 S April Volt Battery Company Summary of Cash Payments February March 0 S 0 0 b. Prepare a monthly summary of cash payments for January through June. Volt Battery produced 800 units in December. May 0 0 S June April 0 0 S 0 July May S June
The Volt Battery Company has forecast its sales in units as follows: January February March April May June July 1,000 850 888 1,300 1,550 1,700 1,480 Volt Battery always keeps an ending inventory equal to 120 percent of the next month's expected sales. The ending inventory for December (January's beginning inventory) is 1,200 units, which is consistent with this policy. Materials cost $11 per unit and are paid for in the month after purchase. Labor cost is $4 per unit and is paid in the month the cost incurred. Overhead costs are $7,000 per month. Interest of $8,200 is scheduled to be paid in March, and employee bonuses of $13,400 will be paid in June. a. Prepare a monthly production schedule for January through June. Note: Input all amounts as positive values except Beginning Inventory values under Production Schedule which should be entered with a minus sign. Leave no cells blank be certain to enter O wherever required. Projected unit sales Desired ending inventory Total units required Beginning inventory Units to be produced January Units produced Material cost Labor cost Overhead cost Interest Employee bonuses Total cash payments 0 December 0 Volt Battery Company Production Schedule March February S January 0 0 0 S April Volt Battery Company Summary of Cash Payments February March 0 S 0 0 b. Prepare a monthly summary of cash payments for January through June. Volt Battery produced 800 units in December. May 0 0 S June April 0 0 S 0 July May S June
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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