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Four grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $1.70 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3: First 92,000 Year 2 Second 122,000 Third 182,000 Fourth 132,000 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Year 3 First 102,000 Budgeted production, in bottles The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 73,600 grams of musk oil will be on hand to start the first quarter of Year 2.

Four grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $1.70 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3: First 92,000 Year 2 Second 122,000 Third 182,000 Fourth 132,000 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Year 3 First 102,000 Budgeted production, in bottles The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 73,600 grams of musk oil will be on hand to start the first quarter of Year 2.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Four grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $1.70 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3: First 92,000 Required production in units of finished goods Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Desired units of ending raw materials inventory Total units of raw materials needed Less: Units of beginning raw materials inventory Units of raw materials to be purchased Unit cost of raw materials Second 122,000 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. $ Budgeted production, in bottles The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 73,600 grams of musk oil will be on hand to start the first quarter of Year 2. Mink Caress Direct Materials Budget - Year 2 First Year 2 Answer is not complete. 92,000 4 368,000 97,600 465,600 73,600 392,000 33 Third 182,000 1.70 $ Second Quarter 122,000 4 488,000 145,600 633,600 97,600 536,000 1.70 3333 $ Fourth 132,000 Third 182,000 4 728,000 105,600 833,600 145,600 688,000 1.70 $ Year 3 First 102,000 Fourth 132,000 4 528,000 81,600 609,600 105,600 504,000 1.70 $ Year 528,000 4 2,112,000 1.70
Transcribed Image Text:Four grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $1.70 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3: First 92,000 Required production in units of finished goods Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Desired units of ending raw materials inventory Total units of raw materials needed Less: Units of beginning raw materials inventory Units of raw materials to be purchased Unit cost of raw materials Second 122,000 Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. $ Budgeted production, in bottles The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 73,600 grams of musk oil will be on hand to start the first quarter of Year 2. Mink Caress Direct Materials Budget - Year 2 First Year 2 Answer is not complete. 92,000 4 368,000 97,600 465,600 73,600 392,000 33 Third 182,000 1.70 $ Second Quarter 122,000 4 488,000 145,600 633,600 97,600 536,000 1.70 3333 $ Fourth 132,000 Third 182,000 4 728,000 105,600 833,600 145,600 688,000 1.70 $ Year 3 First 102,000 Fourth 132,000 4 528,000 81,600 609,600 105,600 504,000 1.70 $ Year 528,000 4 2,112,000 1.70
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