2)Production and sales estimates for May for the Cardinal Co. are as follows: Th
ID: 2557213 • Letter: 2
Question
2)Production and sales estimates for May for the Cardinal Co. are as follows:
The number of units expected to be sold in May is
a.20,070
b.22,300
c.13,500
d.26,760
3)Finch Company began its operations on March 31 of the current year. Finch has the following projected costs:
(1) Of the manufacturing costs, three-fourths are paid for in the month they are incurred; one-fourth is paid in the following month.
(2) Insurance expense is $840 a month; however, the insurance is paid four times yearly in the first month of the quarter, (i.e., January, April, July, and October).
(3) Property tax is paid once a year in November.
The cash payments for Finch Company expected in the month of June are
a.$258,250
b.$161,250
c.$209,750
d.$48,500
4)Finch Company began its operations on March 31 of the current year. Finch has the following projected costs:
(1) Of the manufacturing costs, three-fourths are paid for in the month they are incurred; one-fourth is paid in the following month.
(2) Insurance expense is $1,000 a month; however, the insurance is paid four times yearly in the first month of the quarter, (i.e., January, April, July, and October).
(3) Property tax is paid once a year in November.
The cash payments for Finch Company expected in the month of June are
a.$214,000
b.$212,000
c.$215,500
d.$188,800
5)Finch Company began its operations on March 31 of the current year. Finch has the following projected costs:
(1) Of the manufacturing costs, three-fourths are paid for in the month they are incurred; one-fourth is paid in the following month.
(2) Insurance expense is $1,000 a month; however, the insurance is paid four times yearly in the first month of the quarter, (i.e., January, April, July, and October).
(3) Property tax is paid once a year in November.
The cash payments expected for Finch Company in the month of May are
a.$149,900
b.$185,600
c.$189,100
d.$187,600
6)Next year’s sales forecast shows that 20,000 units of Product A and 22,000 units of Product B are going to be sold for prices of $10 and $12 per unit, respectively. The desired ending inventory of Product A is 20% higher than its beginning inventory of 2,000 units. The beginning inventory of Product B is 2,500 units. The desired ending inventory of B is 3,000 units.
Budgeted production of Product B for the year would be
a.23,200 units
b.22,500 units
c.24,500 units
d.26,500 units
7)Next year’s sales forecast shows that 20,000 units of Product A and 22,000 units of Product B are going to be sold for prices of $10 and $12 per unit, respectively. The desired ending inventory of Product A is 20% higher than its beginning inventory of 2,000 units. The beginning inventory of Product B is 2,500 units. The desired ending inventory of B is 3,000 units.
Total budgeted sales of both products for the year would be
a.$264,000
b.$464,000
c.$42,000
d.$200,000
Estimated inventory (units), May 1 18,800 Desired inventory (units), May 31 19,800 Expected sales volume (units): Area W 6,300 Area X 8,800 Area Y 7,200 Unit sales price $12.00Explanation / Answer
2) The number of units expected to be sold in the month of May is 22300 units (6300+8800+7200)
3) Cash payment for the month of June will be $209750 which comprises 3/4 of the manufacturing cost of June $161250($215000×3/4) +1/4 of the manufacturing cost of may $48500($194000×1/4)
4)cash payment for the month of June will be $212000 ($217600×3/4 + $195200×1/4)
5) cash payment for the month of may will be $185600 ($195200×3/4 + $156800×1/4)
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