31. Porcelain Interiors sells a variety of porcelain products including porcelain sinks. At December 31, the company had 200 sinks in inventory. The company’s policy is to maintain a sink inventory equal to 5% of next month’s sales. The company expects the following sales activity for the first quarter of the year:
January
1,500 sinks
February
2,000 sinks
March
2,300 sinks
What is the projected production for February? A. 2,115B. 2,015C. 1,985D. 2,215
32. Homestyle Interiors sells a variety of home furnishings including sleeper sofas. At March 31, the company had 400 sofas in inventory. The company’s policy is to maintain a sleeper sofa inventory equal to 2% of next month’s sales. The company expects the following sales activity for the second quarter of the year:
April
1,000 sofas
May
1,400 sofas
June
2,000 sofas
What is the projected production for May? A. 1,332 sofasB. 1,468 sofasC. 1,388 sofasD. 1,412 sofas
33. Homestyle Interiors sells a variety of home furnishings including entertainment centers. At March 31, the company had 150 centers in inventory. The company’s policy is to maintain a entertainment center inventory equal to 3% of next month’s sales. The company expects the following sales activity for the second quarter of the year:
April
800 centers
May
1,200 centers
June
1,000 centers
What is the projected production for May? A. 1,206 centersB. 1,194 centersC. 1,266 centersD. 1,134 centers
34. Select Manufacturing sells a variety of office products including two-drawer file cabinets. On June 30, the company had 300 cabinets in inventory. The company’s policy is to maintain a cabinet inventory equal to 10% of next month’s sales. The company expects the following sales activity for the third quarter of the year:
July
3,000 cabinets
August
4,000 cabinets
September
4,800 cabinets
In addition, October’s sales are projected to be 5,000 cabinets. What is the total required production for the third quarter? A. 12,980 cabinetsB. 12,300 cabinetsC. 12,000 cabinetsD. 11,800 cabinets
35. Keep-it-Cool Products Inc. manufactures a medium-sized drink cooler. At June 30, the company had 5,000 coolers in inventory. The company’s policy is to maintain a cooler inventory equal to 15% of next month’s sales. The company expects the following sales activity for the third quarter of the year:
July
50,000 coolers
August
40,000 coolers
September
25,000 coolers
How many coolers should be produced in August? A. 37,750 coolersB. 36,250 coolersC. 42,250 coolersD. 43,750 coolers
36. Tunstall Manufacturing sells medical supplies, including stethoscopes. At September 30, the company had 1,000 stethoscopes in inventory. The company’s policy is to maintain an inventory equal to 8% of next month’s sales. The company expects the following sales activity for the fourth quarter of the year:
October
11,000 stethoscopes
November
15,000 stethoscopes
December
14,000 stethoscopes
In addition, January of the following year’s sales are projected to be 16,000 stethoscopes. What is the total required production for the fourth quarter? A. 40,280 stethoscopesB. 39,000 stethoscopesC. 39,720 stethoscopesD. 41,280 stethoscopes
37. Donnelly Manufacturing sells cedar birdhouses. The company has prepared the following forecast for the third quarter of 2008:
July
5,000 units
August
6,000 units
September
10,000 units
Inventory at June 30, 2008 was budgeted at 1,000 units. Management would like the desired quantity of finished goods inventory at the end of each month to be equal to 20% of next month’s budgeted unit sales. October’s sales are projected to be 12,000 units.Each completed unit of finished product requires 3 square feet of cedar at a cost of $1.50 per square foot. Refer to the Donnelly Manufacturing information above. The company has determined that it needs 20 percent of next month’s raw material needs on hand at the end of each month.The total required production of birdhouses for the third quarter of 2008 is: A. 19,600 unitsB. 22,400 unitsC. 20,000 unitsD. 23,400 units
38. Donnelly Manufacturing sells cedar birdhouses. The company has prepared the following forecast for the third quarter of 2008:
July
5,000 units
August
6,000 units
September
10,000 units
Inventory at June 30, 2008 was budgeted at 1,000 units. Management would like the desired quantity of finished goods inventory at the end of each month to be equal to 20% of next month’s budgeted unit sales. October’s sales are projected to be 12,000 units.Each completed unit of finished product requires 3 square feet of cedar at a cost of $1.50 per square foot. Refer to the Donnelly Manufacturing information above. The company has determined that it needs 10 percent of next month’s raw material needs on hand at the end of each month.The cost of the direct material that should be purchased in August is: A. $32,220B. $21,480C. $30,600D. $35,280
39. Jones Manufacturing sells unique decorative water fountains. The company has prepared the following forecast for the first quarter of 2008:
January
1,000 units
February
1,400 units
March
2,000 units
Ending inventory at December 31, 2007 was budgeted at 80 units. Management would like the desired quantity of finished goods inventory at the end of each month to be equal to 10 percent of next month’s budgeted unit sales. April’s sales are projected to be 1,600 units.Each completed unit of finished product requires 3 pounds of compounding material at a cost of $2.00 per pound. The company has determined that it needs 15 percent of next month’s raw material needs on hand at the end of each month. Refer to the Jones Manufacturing information above. The total required production of water fountains for the first quarter of 2008 is: A. 4,320 unitsB. 4,560 unitsC. 4,640 unitsD. 4,480 units
40. Jones Manufacturing sells unique decorative water fountains. The company has prepared the following forecast for the first quarter of 2008:
January
1,000 units
February
1,400 units
March
2,000 units
Ending inventory at December 31, 2007 was budgeted at 80 units. Management would like the desired quantity of finished goods inventory at the end of each month to be equal to 10 percent of next month’s budgeted unit sales. April’s sales are projected to be 1,600 units.Each completed unit of finished product requires 3 pounds of compounding material at a cost of $2.00 per pound. The company has determined that it needs 15 percent of next month’s raw material needs on hand at the end of each month. Refer to the Jones Manufacturing information above. The cost of the direct material that should be purchased in February is: A. $ 9,210B. $ 8,760C. $ 9,570D. $10,524
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