Excelsior Springs Ltd. schedules production of one end product, Hi-Sulphur, in batches of 80 units whenever the projected ending inventory balance in a quarter falls below 10 units
1.Excelsior Springs Ltd. schedules production of one end product, Hi-Sulphur, in batches of 80 units whenever the projected ending inventory balance in a quarter falls below 10 units. It takes one quarter to make a batch of 80 units. Excelsior currently has 30 units on hand. The sales forecast for the next four quarters is:
| Quarter | ||||
| 1 | 2 | 3 | 4 | |
| Forecast | 20 | 70 | 70 | 20 |
a.Prepare a time-phased MPS record showing the sales forecast and MPS for Hi-Sulphur.
b.What are the inventory balances at the end of each quarter?
c.During the first quarter, no units were sold. The revised forecast for the rest of the year is:
| Quarter | |||
| 2 | 3 | 4 | |
| Forecast | 30 | 50 | 70 |
How does the MPS change?
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