Jadara Company produces t-shirts from fabric. It has aninventory of 37,500 units of t-shirts on hand at December 31and has estimated an inventoryof 42,000 units of t-shirts at theend of the succeeding quarter.The company has prepared asales budget of 275,000 units oft-shirts for a 3-month period.The company has an inventory of85,750 yards at December 31and has a target ending inventoryof 57,000 yards at the end of thesucceeding quarter. One unit of t-shirt needs 2.5 yards. How manyyards of direct materials (fabric)should Jadara purchase duringthe 3 months ending March 31?

The budget is prepared to estimated the required production or purchases during the period.

Jadara Company produces t- shirts from fabric. It has an inventory of 37,500 units of t- shirts on hand at December 31 and has estimated an inventory of 42,000 units of t-shirts at the end of the succeeding quarter. The company has prepared a sales budget of 275,000 units of

Jadara Company produces t- shirts from fabric. It has an inventory of 37,500 units of t- shirts on hand at December 31 and has estimated an inventory of 42,000 units of t-shirts at the end of the succeeding quarter. The company has prepared a sales budget of 275,000 units of

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 4EB: Rehydrator makes a nutrition additive and expects to sell 3,000 units in January, 2,000 in February,...

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Question

Jadara Company produces t-
shirts from fabric. It has an
inventory of 37,500 units of t-
shirts on hand at December 31
and has estimated an inventory
of 42,000 units of t-shirts at the
end of the succeeding quarter.
The company has prepared a
sales budget of 275,000 units of
t-shirts for a 3-month period.
The company has an inventory of
85,750 yards at December 31
and has a target ending inventory
of 57,000 yards at the end of the
succeeding quarter. One unit of t-
shirt needs 2.5 yards. How many
yards of direct materials (fabric)
should Jadara purchase during
the 3 months ending March 31?

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