Question 3 What is the ending inventory level for April in the production plan s

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Question 3 What is the ending inventory level for April in the production plan shown in the table? All entries in the table are in terms of sales units. Regular Overtime Ending Month Forecast Production Production 300 500 300 325 400 25 25 A) 100 Units B) 125 Units C) 150 Units D) 75 Units Question 4: A company has a sales forecast for the following five months as shown in the table. If they have a beginning inventory of 350 units, what amount should be produced under a level plan in order for them to have an ending inventory of zero units at the end of the five month period? Month Forecast 525 600 March 750 Ma A) 610 units per month B) 595 units per month C) 640 units per month D) 580 units per month

Explanation / Answer

QUESTION 3 B C D E F G H month Sales forecast regular production overtime production ending inventory carry over to next month 3 January 250 250 0 0 0 4 February 200 300 0 100 100 G3+F4 5 March 300 325 25 50 150 G4+F5 6 April 500 400 25 -75 75 G5+F6 ANSWER D)75 UNITS QUESTION 4 month sales forecast opening stock production closing cumulative closing 13 january 525 350 610 435 435 14 february 600 0 610 10 445 15 March 650 0 610 -40 405 16 april 750 0 610 -140 265 17 May 875 0 610 -265 0 18 total forecast sales 3400 SUM(C13:C17) 19 number of month 5 20 opening stock 350 (given) 21 adjusted production required to meet the demand ( opening stock is sold in the month of January itself) 3050 C18-C20 fifo basis 22 average adjusted production required per month 610 C21/C19 ANSWER a) 610 units pm

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