What is munchs expected profit for april

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Reference no: EM13516774

What is Munch"s expected profit for April?

  1. $192,500
  2. $56,000
  3. $66,000
  4. $59,000

Munch Enterprises makes a small toy car that is voice activated. Projected sales for the next four months are

Month

Planned Sales (Units)

April

5,500

May

6,500

June

4,500

July

5,600

The cars sell for $35 each. To produce each car requires $12.50 in direct materials and $6.00 in direct labour. Fixed overhead costs related to manufacturing the car are $10,000 per month, while variable overhead is $4.50 per car. Munch normally produces a month"s supply of inventory to ensure that it will not fall short in case sales are unexpectedly high. At the end of March, for instance, the company will have inventory to cover April sales.

Reference no: EM13516774

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