contestada

Jackson Inc. produces leather handbags. The production budget for the next four months is: July 5,000 units, August 7,000, September 7,500, October 8,000. Each handbag requires 0.5 square meters of leather. Jackson Inc.’s leather inventory policy is 30% of next month’s production needs. On July 1 leather inventory was expected to be 1,000 square meters. Leather is expected to cost $5.00 per square meter in June, but go up to $6.00 per square meter in July. What is the expected cost of leather purchases in July?

Respuesta :

abiolataiwo2015

Answer:

$15,300

Explanation:

Jackson Inc

July Production Needs of Leather

= 5000 units *0.5 = 2500 Square meters

July 1 Leather inventory = 1000 square meters

July 31 Leather Inventory

= August Product needs * 30% = 7000*0.5 *30% = 1050 square meters

Leather purchases in July

= July 31 Leather inventory + July Production Needs of Leather - July 1 Leather inventory

= 1050 + 2500 - 1000 = 2550 square meters

expected cost of leather purchases in July = 2550 * $6 = $15,300

Therefore the expected cost of leather purchases in July is $15,300

The expected cost of the leather purchase should be considered as the $15,300.

Calculation of the cost of the leather purchase:

Since production needs should be

= 5000 units *0.5

= 2500 Square meters

And, July 1 Leather inventory = 1000 square meters

So,

July 31 Leather Inventory

= August Product needs * 30%

= 7000*0.5 *30%

= 1050 square meters

Now

Leather purchase should be

= July 31 Leather inventory + July Production Needs of Leather - July 1 Leather inventory

= 1050 + 2500 - 1000

= 2550 square meters

Now

expected cost of leather purchases in July is

= 2550 * $6

= $15,300

Therefore the expected cost of leather purchases in July is $15,300

Learn more about purchase here: https://brainly.com/question/24109651

Otras preguntas