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Meridian Industries manufactures and sells two models of watches, Prime and Luxuria. It expects to sell...

Meridian Industries manufactures and sells two models of watches, Prime and Luxuria. It expects to sell 3,000 units of Prime and 1,000 units of Luxuria in 2016.The following estimates are given for 2016:

              

                                                                                  Prime    Luxuria

        Selling price                                                     $200        $500

        Direct materials                                                   20             50

        Direct labor                                                          40          150

        Manufacturing overhead                                  40          100

Meridian had an inventory of 200 units of Prime and 75 units of Luxuria at the end of 2015. It has decided that as a measure to counter stock outages it will maintain ending inventory of 350 units of Prime and 200 units of Luxuria. Each Luxuria watch requires one unit of Crimpson and has to be imported at a cost of $10. There were 100 units of Crimpson in stock at the end of 2015.The management does not want to have any stock of Crimpson at the end of 2016.

How many units of Prime watches must be produced in 2016?

What is the amount budgeted for purchase of Crimpson in 2016?

What is the total budgeted cost of sold for Meridian Industries in 2016?

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ekkarill92 answered 2 years ago
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