Business, 07.11.2019 01:31 charrsch9909
Weed master company plans to sell 400,000 units of finished product in july and anticipates a growth rate in sales of 5 percent per month. the desired monthly ending inventory in units of finished product is 90 percent of the next month’s estimated sales. there are 360,000 finished units in inventory on may 31. each unit of finished product requires three pounds of raw material at a cost of $1.40 per pound. there are 770,000 pounds of raw material in inventory on may 31.
required:
compute the company’s total required production in units of finished product for the entire three-month period ending august 31.
independent of your answer to requirement (a), assume the company plans to produce 670,000 units of finished product in the three-month period ending august 31, and to have raw-material inventory on hand at the end of the three-month period equal to 20 percent of the use in that period. compute the total estimated cost of raw-material purchases for the entire three-month period ending august 31
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