Question

Sunland Hats is planning to sell 648 straw hats in April. Each hat requires ½ kilogram of straw and ¼ hour of direct labour. Straw costs $0.20 per kilogram and employees of the company are paid $21 per hour. Sunland has 80 kilograms of straw and 44 hats in beginning inventory and wants to have 55 kilograms of straw and 64 hats in ending inventory. How many units should Sunland Hats produce in April? Select answer from the options below

a.668
b.648
c.604
d.712

Answer 1

Sunland Hats should produce 668 straw hats in April, which is calculated by adding the desired sales and ending inventory and subtracting the beginning inventory.The correct answer is option a.

Step-by-step explanation:

To determine how many units Sunland Hats should produce in April, we need to account for both the beginning inventory and the desired ending inventory levels, as well as the expected sales. Calculation is as follows:

Sales (units intended to sell in April): 648

Plus: Ending Inventory (desired inventory at end of April): 64

Minus: Beginning Inventory (inventory already in stock): 44

The production for April should be the sum of expected sales and the desired ending inventory, minus the beginning inventory. Therefore:

648 (Sales) + 64 (Ending Inventory) - 44 (Beginning Inventory) = 668

The correct option for the number of straw hats Sunland Hats should produce in April is 668 units (Option a).