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Question - 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 end of the first quarter of the new-year, and that at the end of the prior 4th quarter, there were 60,000 pounds of material on hand.
Required -
a. How many units of product were planned for production in the first quarter?
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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