The Boswell Corporation forecasts its sales in units for the next four months as follows: March 11,000 April 13,000 May 10,500 June 9,000 Boswell maintains an ending inventory for each month in the amount of three times the expected sales in the following month. The ending inventory for February (March's beginning inventory) reflects this policy. Materials cost $8 per unit and are paid for in the month after production. Labour cost is $12 per unit and is paid for in the month incurred. Fixed overhead is $14,500 per month. Dividends of $20,500 are to be paid in May.
The Boswell Corporation forecasts its sales in units for the next four months as follows: March 11,000 April 13,000 May 10,500 June 9,000 Boswell maintains an ending inventory for each month in the amount of three times the expected sales in the following month. The ending inventory for February (March's beginning inventory) reflects this policy. Materials cost $8 per unit and are paid for in the month after production. Labour cost is $12 per unit and is paid for in the month incurred. Fixed overhead is $14,500 per month. Dividends of $20,500 are to be paid in May.
Excel Applications for Accounting Principles
4th Edition
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Gaylord N. Smith
ChapterC: Cases
Section: Chapter Questions
Problem 1C
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The Boswell Corporation forecasts its sales in units for the next four months as follows: March 11,000 April 13,000 May 10,500 June 9,000 Boswell maintains an ending inventory for each month in the amount of three times the expected sales in the following month. The ending inventory for February (March's beginning inventory) reflects this policy. Materials cost $8 per unit and are paid for in the month after production. Labour cost is $12 per unit and is paid for in the month incurred. Fixed overhead is $14,500 per month. Dividends of $20,500 are to be paid in May.
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