The Bandit\'s Beagle Company produces wood dog houses that sell for $400 each. B

Question

The Bandit's Beagle Company produces wood dog houses that sell for $400 each. Budgeted sales for the first four months are as follows: Month January February March April Budgeted Sales (units) 1,000 1,500 2,500 2,000 Each dog house requires 20 square feet of oak at a cost of $10 per square foot. The company wants to maintain an inventory ofdog houses equal to 10% of the following month's sales. Inventory on January 1 consisted of 80 dog houses. The company wants to maintain an inventory of oak equal to 20% of next month's needs. Materials inventory on January 1 consisted of 11,000 square feet of oak. The company estimates an inventory of oak on hand at the end of March to equal 8,000 square feet

Explanation / Answer

Working:

1. Sales Budget Jan Feb Mar April Quarter Sale Units 1000 1500 2500 2000 5000 Price per unit 400 400 400 400 400 Total Sale 400000 600000 1000000 800000 2000000

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