A company makes and sells a seasonal products . based on a sales forecast of 2000, 3000, and 5000 per quarter , calculate a level production plan , quarterly ending inventory , and average quarterly inventory . if inventory carrying cost are 3 $ per unit per quarter , what is the annual cost of carrying inventory ? opening and ending inventories are zero .
answer by a typing please
1. Calculation of Production Plan
Quarter 1 | Quarter 2 | Quarter 3 | Quarter 4 | |
Opening Inventory(given as zero) | 0 | 0 | 0 | 0 |
Production | 2000 | 3000 | 5000 | 0 |
Closing Inventory(given as zero) | 0 | 0 | 0 | 0 |
Sales per quarter(Given) | 2000 | 3000 | 5000 | 0 |
2. Quarterly Ending Inventory is 2000 3000 5000 0
3. Average Quarterly Inventory is (2000+3000+5000)/4 = 2500
4. Calculation of Annual Cost of Carrying Inventory
Quarter 1 | Quarter 2 | Quarter 3 | Quarter 4 | |
Inventory during the quarter | 2000 | 3000 | 5000 | 0 |
Inventory cost per unit per quarter(given) | 3$ | 3$ | 3$ | 3$ |
Cost (Sales x Inventory cost) | $6000 | $9000 | $1500 | 0 |
Therefore Total annual cost of carrying inventory is $6000+$9000+$15000 = $30000
A company makes and sells a seasonal products . based on a sales forecast of 2000,...
Togo makes riding lawn mowers and tractors. The company’s expected quarterly demand is given below in the chart. The company will have 300 mowers in inventory at the beginning of the month and desires to maintain at least that number at the end of each month. Below is other critical data: Production cost per unit = $325 Inventory carrying cost per month per unit = $60 (based on ending month inventory) Hiring cost per worker = $450 Firing cost per...
Culver Company produces and sells automobile batteries, the heavy-duty HD-240. The 2017 sales forecast is as follows. Quarter HD-240 1 5,400 2 7,430 3 8,450 4 10,230 The January 1, 2017, inventory of HD-240 is 2,160 units. Management desires an ending inventory each quarter equal to 40% of the next quarter’s sales. Sales in the first quarter of 2018 are expected to be 25% higher than sales in the same quarter in 2017. Prepare quarterly production budgets for each quarter...
Turney Company produces and sells automobile batteries, the heavy-duty HD-240. The 2020 sales forecast is as follows. Quarter NM + HD-240 5,200 7,150 8,320 10,190 The January 1, 2020, inventory of HD-240 is 2,080 units. Management desires an ending inventory each quarter equal to 40% of the next quarter's sales. Sales in the first quarter of 2021 are expected to be 25% higher than sales in the same quarter in 2020. Prepare quarterly production budgets for each quarter and in...
Turney Company produces and sells automobile batteries, the heavy-duty HD-240. The 2020 sales forecast is as follows. Quarter HD-240 5,100 7,490 8,330 10,350 The January 1, 2020, inventory of HD-240 is 2,040 units. Management desires an ending inventory each quarter equal to 40% of the next quarter's sales. Sales in the first quarter of 2021 are expected to be 25% higher than sales in the same quarter in 2020. Prepare quarterly production budgets for each quarter and in total for...
Thanks! Bridgeport Company produces and sells automobile batteries, the heavy-duty HD-240. The 2017 sales forecast is as follows. Quarter HD-240 5,200 2 7,110 8,190 10,240 The January 1, 2017, inventory of HD-240 is 2,080 units. Management desires an ending inventory each quarter equal to 40% of the next quarter's sales. Sales in the first quarter of 2018 are expected to be 25% higher than sales in the same quarter in 2017. Prepare quarterly production budgets for each quarter and in...
Turney Company produces and sells automobile batteries, the heavy-duty HD-240. The 2017 sales forecast is as follows. Quarter HD-240 1 5,200 2 7,420 3 8,110 4 10,150 The January 1, 2017, inventory of HD-240 is 2,080 units. Management desires an ending inventory each quarter equal to 40% of the next quarter’s sales. Sales in the first quarter of 2018 are expected to be 25% higher than sales in the same quarter in 2017. Prepare quarterly production budgets for each quarter...
Turney Company produces and sells automobile batteries, the heavy-duty HD-240. The 2020 sales forecast is as follows. Quarter HD-240 1 5,400 2 7,430 3 8,450 4 10,230 The January 1, 2020, inventory of HD-240 is 2,160 units. Management desires an ending inventory each quarter equal to 40% of the next quarter’s sales. Sales in the first quarter of 2021 are expected to be 25% higher than sales in the same quarter in 2020. Prepare quarterly production budgets for each quarter...
Exercise 21-4 Turney Company produces and sells automobile batteries, the heavy-duty HD-240. The 2017 sales forecast is as follows. Quarter HD-240 1 5,200 2 7,220 3 8,280 4 10,180 The January 1, 2017, inventory of HD-240 is 2,080 units. Management desires an ending inventory each quarter equal to 40% of the next quarter’s sales. Sales in the first quarter of 2018 are expected to be 25% higher than sales in the same quarter in 2017. Prepare quarterly production budgets for...
The following forecast constitutes the demand for relay switches. John Smith, the production planner, has assembled the following cost data and the quarterly demand forecast: QUARTER FORECAST 1,800 1 2 1,100 3 1,600 900 4 Costs/Other Data Previous quarter's output = 1300 cases Beginning inventory 350 cases Stockout cost = $110 per case Inventory holding cost $30 per case at the end of quarter Hiring employees = $40 per case Terminating employees = $75 per case Subcontracting cost = $60...
Please finish. Oriole Company produces and sells automobile batteries, the heavy-duty HD-240. The 2020 sales forecast is as follows. Quarter HD-240 5,400 7,130 8,110 10,350 The January 1, 2020, inventory of HD-240 is 2,160 units. Management desires an ending inventory each quarter equal to 40% of the next quarter's sales. Sales in the first quarter of 2021 are expected to be 25% higher than sales in the same quarter in 2020. Prepare quarterly production budgets for each quarter and in...