Question
A company produces doors. The following information wasgathered to prepare budgets for the upcoming year beginning January1: sales forecast inunits................................... 5,500 doors finished goods inventory,Jan1....................... 620 doors target finished goods inventory,Dec1............. 480 doors raw materials inventory-steel, Jan1................ 40,000lbs targetinventory-steel,Dec1.......................... 80,000lbs raw materialsinventory-glass,Jan1.................. 6,000 squarefeet targetinventory-glass,Dec1............................ 4,000square feet budgeted purchase price-steel......................... $4 perlb budgeted purchase price-glass.........................$2 persquare foot The manufacture of each door requires 20 lbs of steel and 6square feet of glass **Prepare the production schedule in units for thecompany A company produces doors. The following information wasgathered to prepare budgets for the upcoming year beginning January1: sales forecast inunits................................... 5,500 doors finished goods inventory,Jan1....................... 620 doors target finished goods inventory,Dec1............. 480 doors raw materials inventory-steel, Jan1................ 40,000lbs targetinventory-steel,Dec1.......................... 80,000lbs raw materialsinventory-glass,Jan1.................. 6,000 squarefeet targetinventory-glass,Dec1............................ 4,000square feet budgeted purchase price-steel......................... $4 perlb budgeted purchase price-glass.........................$2 persquare foot The manufacture of each door requires 20 lbs of steel and 6square feet of glass **Prepare the production schedule in units for thecompany
Explanation / Answer
Production Schedule ============== Salesforcast 5,500doors Add : Target finished goods inventory on Dec.1 or31(check) 480 doors -------------- TotalUnitsrequired 5,980doors Less : Opening Finished goods inventory on Jan.1 620doors ---------------- Productionrequired 5,360doors ============