Problem:
(Production and related schedules) The Jansen Company manufactures and sells two products: plastic boxes and plastic trays. Estimated needs for a unit of each are
|
Boxes
|
Trays
|
|
Material A
|
2 pounds
|
1 pound
|
|
Material B
|
4 pounds
|
4 pounds
|
|
Direct labor
|
2 hours
|
2 hours
|
Overhead is applied on the basis of $2 per direct labor hour. The estimated sales by product for 2000 are:
|
Boxes
|
Trays
|
|
Sales
|
42,000
|
24,000
|
The beginning inventories are expected to be as follows:
|
Material A
|
4,000 pounds
|
|
Material B
|
6,000 pounds
|
|
Boxes
|
1,000 units
|
|
Trays
|
500 units
|
The desired inventories are one month's production requirements, assuming constant sales throughout the year.
Prepare the following information:
a. Production schedule
b. Purchases budget in units
c. Direct labor budget in hours
d. Overhead to be charged to production