Johnson last month (December) sales were 20,000 units @ $50. The company estimates an increase...
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Accounting
Johnson last month (December) sales were 20,000 units @ $50. The company estimates an increase of 1.5% in sales for January. An increase of 200 units for February (compared to January) and a reduction of 100 units for March (compared to February). The selling price is not expected to change. April sales projections are a 5% increase from December sales.
INVENTORY POLICY
FINISHED GOODS maintain an ending inventory equal to 30% of next month sales
December finished goods ending inventory was 7,000 units
DIRECT MATERIALS maintain an ending inventory equal to 40% of next month production
April production is estimated at 21,000
Materials cost is $10 per pound. Each unit requires .25 pounds of materials and actual inventory is 1,600 pounds
Labor Cost is $14 per hour and each unit requires 30 minutes of labor.
Fixed overhead is $62,517 monthly and variable overhead is 120% of direct labor cost.
CALCULATE MATERIALS TO BE PURCHASED IN MARCH
PRESENT YOUR ANSWER ROUNDED TO ZERO DECIMAL PLACES
DON'T USE COMMA SEPARATORS
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