The Company manufactures foam cushions. The number of cushions to be produced in the upcoming three months follows:Number of foam cushions to be produced in July13,000Number of foam cushions to be produced in August19,000Number of foam cushions to be produced in September12,000Each cushion requires 2 pounds of the foam used as stuffing. The Company has a policy that the ending inventory of foam each month must be equal to 30% of the following month's expected production needs. How many pounds of foam does the Company need to purchase in August?

(1). Opening Inventory = 30% of (19,000 x 2) =11,400 pounds…

Answered: The Company manufactures foam cushions.…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The Company manufactures foam cushions. The number of cushions to be produced in the upcoming three months follows:

Number of foam cushions to be produced in July	13,000
Number of foam cushions to be produced in August	19,000
Number of foam cushions to be produced in September	12,000

Each cushion requires 2 pounds of the foam used as stuffing. The Company has a policy that the ending inventory of foam each month must be equal to 30% of the following month's expected production needs. How many pounds of foam does the Company need to purchase in August?

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