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The Volt Battery Company has forecast its sales in units as follows: January 3,200 May 3,750...

The Volt Battery Company has forecast its sales in units as follows:

January 3,200 May 3,750
February 3,050 June 3,900
March 3,000 July 3,600
April 3,500

Volt Battery always keeps an ending inventory equal to 140% of the next month’s expected sales. The ending inventory for December (January’s beginning inventory) is 4,480 units, which is consistent with this policy.
  
Materials cost $15 per unit and are paid for in the month after purchase. Labor cost is $8 per unit and is paid in the month the cost is incurred. Overhead costs are $18,000 per month. Interest of $10,400 is scheduled to be paid in March, and employee bonuses of $15,600 will be paid in June.

a. Prepare a monthly production schedule for January through June.

Volt Battery Company
Summary of Cash Payments
January February March April May June July
Projected unit sales
Desired ending inventory
Total units required 0 0 0 0 0 0
Beginning inventory
Units to be produced 0 0 0 0 0 0

b. Prepare a monthly summary of cash payments for January through June. Volt produced 3,000 units in December.

Volt Battery Company
Summary of Cash Payments
December January February March April May June
Units produced
Material cost
Labor cost
Overhead cost
Interest
Employee bonuses
Total cash payments $0 $0 $0 $0 $0 $0

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SEE THE SCREENSHOT. ANY DOUBTS, HAPPY TO HELP YOU. THANK YOU. THUMBS UP PLEASE.

jeff jeffy answered 1 year ago
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