Aldrin Co manufactures and sells only one product, roasted almonds. Budgeted production in bags for upcoming months are as follows: Budgeted production in bags July 40,000 August 42,000 September 45,000 For each bag, 1.5 pounds of raw almonds are required. The inventory of raw materials at the end of each month should equal 10% of the following month's production needs for raw materials. The cost of raw almonds per pound is $5. What is the cost of required purchases of raw materials for August? a)331,500 b)317,250 c)301,500 d)348,750
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Aldrin Co manufactures and sells only one product, roasted almonds. Budgeted production in bags for upcoming months are as follows:
|
Budgeted production in bags |
|
|
July |
40,000 |
|
August |
42,000 |
|
September |
45,000 |
For each bag, 1.5 pounds of raw almonds are required. The inventory of raw materials at the end of each month should equal 10% of the following month's production needs for raw materials. The cost of raw almonds per pound is $5. What is the cost of required purchases of raw materials for August?
a)331,500
b)317,250
c)301,500
d)348,750
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