D Question 7 Kasson Company has budgeted units to be produced for the next five months as follows: June July August September October budgeted units to be produced 15,000 12,000 22,000 11,000 18,000 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. 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.
D Question 7 Kasson Company has budgeted units to be produced for the next five months as follows: June July August September October budgeted units to be produced 15,000 12,000 22,000 11,000 18,000 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. 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.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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.
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Transcribed Image Text:Question 7
Kasson Company has budgeted units to be produced for the
next five months as follows:
June
July
August
September
October
budgeted units to be produced
15,000
12,000
22,000
11,000
18,000
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.
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.
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