ABC Company's budgeted sales for June, July, and August are 15,800, 19,800, and 17,500 units, respectively. ABC requires 40% of the next month's budgeted unit sales as finished goods inventory each month. Budgeted ending finished goods inventory for May is 6,320 units. Each unit that ABC Company produces uses 2 pounds of raw material. ABC requires 35% of the next month's budgeted production as raw material inventory each month. Required: Calculate the number of pounds of raw material to be purchased in June. Number of pounds

ABC Company's budgeted sales for June, July, and August are 15,800, 19,800, and 17,500 units, respectively. ABC requires 40% of the next month's budgeted unit sales as finished goods inventory each month. Budgeted ending finished goods inventory for May is 6,320 units. Each unit that ABC Company produces uses 2 pounds of raw material. ABC requires 35% of the next month's budgeted production as raw material inventory each month. Required: Calculate the number of pounds of raw material to be purchased in June. Number of pounds

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Rida, Inc., a manufacturer in a seasonal industry, is preparing its direct materials budget for the second quarter. It plans production of 240,000 units in the second quarter and 52,500 units in the third quarter. Raw material inventory is 43,200 pounds at the beginning of the second quarter. Other information follows: Direct materials. Each unit requires 0.60 pounds of raw material, priced at $175 per pound. The company plans to end each quarter with an ending inventory of materials equal to 30% of next quarter's budgeted materials requirements. Prepare a direct materials budget for the second quarter. (Enter "per unit" answers in two decimal places.) Units to be produced RIDA INC. Direct Materials Budget Second Quarter Materials needed for production (pounds) Total materials requirements (pounds) Materials to be purchased (pounds) Budgeted cost of direct materials purchases 240,000 units
ABC Company’s budgeted sales for June, July, and August are 15,000, 19,000, and 16,700 units, respectively. ABC requires 40% of the next month’s budgeted unit sales as finished goods inventory each month. Budgeted ending finished goods inventory for May is 6,000 units. Each unit that ABC Company produces uses 4 pounds of raw material. ABC requires 35% of the next month’s budgeted production as raw material inventory each month. Required: Calculate the number of pounds of raw material to be purchased in June.
Electro Company manufactures transmissions for electric cars. Management reports ending finished goods inventory for the first quarter at 90,000 units. The following unit sales are budgeted during the rest of the year: second quarter, 450,000 units; third quarter, 525,000 units; and fourth quarter, 475,000 units. Company policy calls for the ending finished goods inventory of a quarter to equal 20% of the next quarter's budgeted unit sales. Prepare a production budget for both the second and third quarters that shows the number of transmissions to manufacture. ELECTRO COMPANY Production Budget Next period budgeted sales units Desired ending inventory units Total required units Units to produce Second Quarter Third Quarter
Yummy Foods expects to have 43,000 pounds of raw materials inventory on hand on March 31, the end of the current year. The company budgets the following production (in units) for April through July, inclusive: April 127,000 May 137,000 June 153,000 July 127,000 At the end of each month the firm desires its ending raw material inventory to be 10% of the next month's production needs. Each finished unit requires three pounds of raw materials.Yummy Foods’ budgeted purchases for raw materials (in pounds) during April should be:
Sunrise Poles manufactures hiking poles and is planning on producing 3,646 units in March and 4,395 in April. Each pole requires a half pound of material, which costs $1.17 per pound. The company’s policy is to have enough material on hand to equal 7% of the next month’s production needs and to maintain a finished goods inventory equal to 17% of the next month’s production needs. What is the budgeted cost of purchases for March? Round to the nearest penny, two decimal places.
Kasson Company has budgeted units to be produced for the next five months as follows: budgeted units to be produced June 12,000 July 15,000 August 11,000 September 18,000 October 22,000 Kasson Company used the following information in creating its master budget for the year: 1. Ending direct materials inventory for each month should be equal to 140% of the next month's production needs. 2. Each unit produced requires 2.5 pounds of direct materials. 3. Direct materials are purchased for $2.30 per pound. Calculate the cost of direct materials budgeted to be purchased in June.
kasson Company has budgeted units to be produced for the next five months as follows: budgeted units to be produced June 12,000 July 15,000 August 11,000 September 18,000 October 22,000 Kasson Company used the following information in creating its master budget for the year: Ending direct materials inventory for each month should be equal to 140% of the next month's production needs. Each unit produced requires 2.5 pounds of direct materials. Direct materials are purchased for $2.30 per pound. Kasson Company pays for 65% of a month's purchase of direct materials in the month of purchase, 25% of a month's purchase of direct materials is paid in the month after purchase, and the final 10% is paid in the second month after the month of purchase. Calculate Kasson Company's budgeted accounts payable at September 30.
Prepare a production budget for the first four months of the year. Cloud Shoes manufactures recovery sandals and is planning on producing 12,000 units in March and 11,500 in April. Each sandal requires 1.2 yards if material, which costs $3.00 per yard. The company’s policy is to have enough material on hand to equal 15% of next month’s production needs and to maintain a finished goods inventory equal to 20% of the next month’s production needs. What is the budgeted cost of purchases for March?
Ramos Company provides the following budgeted production for the next four months. Units to produce April 620 May June July 750 720 720 Each finished unit requires 5 pounds of direct materials. The company wants to end each month with direct materials inventory equal to 30% of next month's production needs. Beginning direct materials inventory for April was 930 pounds. Direct materials cost $2 per pound. Prepare a direct materials budget for April, May, and June. Units to produce Materials needed for production (pounds) Total materials required (pounds) Materials to purchase (pounds) Materials cost per pound Cost of direct materials purchases RAMOS COMPANY Direct Materials Budget April May June 620 750 720 units 0
Talal Company’s sales budget projects unit sales of part 198Z of 12,000 units in January, 13,000 units in February, and 14,000 units in March. Each unit of part 198Z requires 5 pounds of materials, which cost $2 per pound. Tyson Chandler Company desires its ending raw materials inventory to equal 60% of the next month’s production requirements, and its ending finished goods inventory to equal 20% of the next month’s expected unit sales. These goals were met at December 31, 2019. Instructions (a) Prepare a production budget for January and February 2020. (b) Prepare a direct materials budget for January 2020.
Zortek Corporation budgets production of 420 units in January and 350 units in February. Each finished unit requires six pounds of material Z, which costs $3 per pound. Each month's ending inventory of material Z should be 30% of the following month's budgeted production. The January 1 inventory has 1,050 pounds of material Z. Prepare a direct materials budget for January. ZORTEK CORP. Direct Materials Budget January Units to produce units Ibs. Materials needed for production (Ibs.) Ibs. Ibs. Total materials requirements (Ibs.) Ibs. Ibs. Materials to be purchased (Ibs.) O Ibs. per Ib. Cost of direct materials purchases
Zortek Corporation budgets production of 490 units in January and 290 units in February, Each finished unit requires five pounds of material Z, which costs $4 per pound. Each month's ending inventory of material Z should be 40% of the following month's budgeted production. The January 1 inventory has 980 pounds of material Z. Prepare a direct materials budget for January. Units to produce ZORTEK CORPORATION Direct Materials Budget Materials needed for production (Pounds) Total materials required (Pounds) Materials to purchase (Pounds) Cost of direct materials purchases . January units pounds pounds pounds pounds pounds i 0 pounds per pound