Gillman Co. is forecasting sales of 61,400 units of product for August. To make one unit...

Expert Solution

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Question

Gillman Co. is forecasting sales of 61,400 units of product for August. To make one unit of finished product, 4 pounds of raw materials are required. Actual beginning and desired ending inventories of raw materials and finished goods are:

Required:

a.	Calculate the number of units of product to be produced during August.

b.	Calculate the number of pounds of raw materials to be purchased during August.

a.	64,720	Units

	Working:
			Units
	Sales		61,400
	Add Desired ending inventory		8,420
	Total units to be available for sale		69,820
	Less beginning inventory		5,100

	Total units to be produced		64,720

b.	Raw Materials to be purchased		2,52,880	Pounds

	Working:

	Total units to be produced				64,720
	Raw materials required to produce 1 unit				4 pounds

	Total raw materials required for production				2,58,880	Pounds
	(64720*4)
	Add: Desired ending inventory of raw materials				68,100	Pounds
	Less: Beginning Inventory of raw materials				74,100	Pounds

	Raw Materials to be purchased				2,52,880	Pounds

jeff jeffy answered 2 years ago

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August 1
(Actual)

August 31
(Desired)

Raw materials (pounds)

Finished goods (units)