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Dina's Lamp Company has forecast its sales in units as follows: January 1,000 May 1,550 February 800 June 1,800 March 900 April 1,400 July 1,400 Dina always keeps an ending inventory equal to 120 percent of the next month's expected sales. The ending inventory for December (January's beginning inventory) is 1,200 units, which is consistent with this policy. Materials cost $14 per unit and are paid for the month after purchase. Labor cost is $7 per unit and is paid in the month the cost is incurred. Overhead costs are $8,000 per month. Interest of $10,000 is scheduled to be paid in March, and employee bonuses of $15,500 will be paid in June.
Prepare a monthly production schedule and a monthly summary of cash payments for January through June. Dina produced 800 units in December.
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