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Ajax Manufacturing produces a single product, which takes 8.0 pounds of direct material per unit produced. The company's policy is to maintain an end-of-quarter inventory of materials equal to 25 percent of the following quarter's material requirements for production. Assume it is currently the end of the first quarter of the new year, and that at the end of the prior 4th quarter, there were 50,000 pounds of material on hand. Required:
Problem a. How many units of product were planned for production in the first quarter?
Problem b. Under the assumption that production will increase by 10% in the second quarter, what are the direct material requirements (in pounds) for planned production in the second quarter?
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