Preparing a Direct Materials Purchases Budget Patrick Inc. makes industrial solvents sold in 5-gallon drum containers. Planned production in units for the first 3 months of the coming year is: January 43,800 February 41,000 March 50,250 Each drum requires 5.5 gallons of chemicals and one plastic drum container. Company policy requires that ending inventories of raw materials for each month be 15% of the next month's production needs. That policy was met for the ending inventory of December in the prior year. The cost of one gallon of chemicals is $2.00. The cost of one drum is $1.60. Required: 1. Calculate the ending inventory of chemicals in gallons for December of the prior year, and for January and February. What is the beginning inventory of chemicals for January? Round your answers to the nearest whole gallon. Ending inventory for December fill in the blank dcecadf46013023_1 gallons Ending inventory for January fill in the blank dcecadf46013023_2 gallons Ending inventory for February fill in the blank dcecadf46013023_3 gallons Beginning inventory for January fill in the blank dcecadf46013023_4 gallons 2. Prepare a direct materials purchases budget for chemicals for the months of January and February. Do not include a multiplication symbol as part of your answer. Patrick Inc. Direct Materials Purchases Budget - Chemicals in Gallons For the Months of January and February January February Production in units fill in the blank cac4d6056fe8ff5_1 fill in the blank cac4d6056fe8ff5_2 Gallons per unit fill in the blank cac4d6056fe8ff5_3 fill in the blank cac4d6056fe8ff5_4 Gallons for production fill in the blank cac4d6056fe8ff5_5 fill in the blank cac4d6056fe8ff5_6 Desired ending inventory fill in the blank cac4d6056fe8ff5_7 fill in the blank cac4d6056fe8ff5_8 Needed fill in the blank cac4d6056fe8ff5_9 fill in the blank cac4d6056fe8ff5_10 Less: Beginning inventory fill in the blank cac4d6056fe8ff5_11 fill in the blank cac4d6056fe8ff5_12 Purchases fill in the blank cac4d6056fe8ff5_13 fill in the blank cac4d6056fe8ff5_14 Price per gallon $fill in the blank cac4d6056fe8ff5_15 $fill in the blank cac4d6056fe8ff5_16 Dollar purchases $fill in the blank cac4d6056fe8ff5_17 $fill in the blank cac4d6056fe8ff5_18 3. Calculate the ending inventory of drums for December of the prior year, and for January and February. Round your answers to the nearest whole unit. Ending inventory for December fill in the blank cadbdcf9afdbff6_1 units Ending inventory for January fill in the blank cadbdcf9afdbff6_2 units Ending inventory for February fill in the blank cadbdcf9afdbff6_3 units

Preparing a Direct Materials Purchases Budget Patrick Inc. makes industrial solvents sold in 5-gallon drum containers. Planned production in units for the first 3 months of the coming year is: January 43,800 February 41,000 March 50,250 Each drum requires 5.5 gallons of chemicals and one plastic drum container. Company policy requires that ending inventories of raw materials for each month be 15% of the next month's production needs. That policy was met for the ending inventory of December in the prior year. The cost of one gallon of chemicals is $2.00. The cost of one drum is $1.60. Required: 1. Calculate the ending inventory of chemicals in gallons for December of the prior year, and for January and February. What is the beginning inventory of chemicals for January? Round your answers to the nearest whole gallon. Ending inventory for December fill in the blank dcecadf46013023_1 gallons Ending inventory for January fill in the blank dcecadf46013023_2 gallons Ending inventory for February fill in the blank dcecadf46013023_3 gallons Beginning inventory for January fill in the blank dcecadf46013023_4 gallons 2. Prepare a direct materials purchases budget for chemicals for the months of January and February. Do not include a multiplication symbol as part of your answer. Patrick Inc. Direct Materials Purchases Budget - Chemicals in Gallons For the Months of January and February January February Production in units fill in the blank cac4d6056fe8ff5_1 fill in the blank cac4d6056fe8ff5_2 Gallons per unit fill in the blank cac4d6056fe8ff5_3 fill in the blank cac4d6056fe8ff5_4 Gallons for production fill in the blank cac4d6056fe8ff5_5 fill in the blank cac4d6056fe8ff5_6 Desired ending inventory fill in the blank cac4d6056fe8ff5_7 fill in the blank cac4d6056fe8ff5_8 Needed fill in the blank cac4d6056fe8ff5_9 fill in the blank cac4d6056fe8ff5_10 Less: Beginning inventory fill in the blank cac4d6056fe8ff5_11 fill in the blank cac4d6056fe8ff5_12 Purchases fill in the blank cac4d6056fe8ff5_13 fill in the blank cac4d6056fe8ff5_14 Price per gallon $fill in the blank cac4d6056fe8ff5_15 $fill in the blank cac4d6056fe8ff5_16 Dollar purchases $fill in the blank cac4d6056fe8ff5_17 $fill in the blank cac4d6056fe8ff5_18 3. Calculate the ending inventory of drums for December of the prior year, and for January and February. Round your answers to the nearest whole unit. Ending inventory for December fill in the blank cadbdcf9afdbff6_1 units Ending inventory for January fill in the blank cadbdcf9afdbff6_2 units Ending inventory for February fill in the blank cadbdcf9afdbff6_3 units

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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Preparing a Direct Materials Purchases Budget

Patrick Inc. makes industrial solvents sold in 5-gallon drum containers. Planned production in units for the first 3 months of the coming year is:

January	43,800
February	41,000
March	50,250

Each drum requires 5.5 gallons of chemicals and one plastic drum container. Company policy requires that ending inventories of raw materials for each month be 15% of the next month's production needs. That policy was met for the ending inventory of December in the prior year. The cost of one gallon of chemicals is $2.00. The cost of one drum is $1.60.

Required:

1. Calculate the ending inventory of chemicals in gallons for December of the prior year, and for January and February. What is the beginning inventory of chemicals for January? Round your answers to the nearest whole gallon.

Ending inventory for December	fill in the blank dcecadf46013023_1 gallons
Ending inventory for January	fill in the blank dcecadf46013023_2 gallons
Ending inventory for February	fill in the blank dcecadf46013023_3 gallons
Beginning inventory for January	fill in the blank dcecadf46013023_4 gallons

2. Prepare a direct materials purchases budget for chemicals for the months of January and February. Do not include a multiplication symbol as part of your answer.

Patrick Inc.
Direct Materials Purchases Budget - Chemicals in Gallons
For the Months of January and February
	January	February
Production in units	fill in the blank cac4d6056fe8ff5_1	fill in the blank cac4d6056fe8ff5_2
Gallons per unit	fill in the blank cac4d6056fe8ff5_3	fill in the blank cac4d6056fe8ff5_4
Gallons for production	fill in the blank cac4d6056fe8ff5_5	fill in the blank cac4d6056fe8ff5_6
Desired ending inventory	fill in the blank cac4d6056fe8ff5_7	fill in the blank cac4d6056fe8ff5_8
Needed	fill in the blank cac4d6056fe8ff5_9	fill in the blank cac4d6056fe8ff5_10
Less: Beginning inventory	fill in the blank cac4d6056fe8ff5_11	fill in the blank cac4d6056fe8ff5_12
Purchases	fill in the blank cac4d6056fe8ff5_13	fill in the blank cac4d6056fe8ff5_14
Price per gallon	$fill in the blank cac4d6056fe8ff5_15	$fill in the blank cac4d6056fe8ff5_16
Dollar purchases	$fill in the blank cac4d6056fe8ff5_17	$fill in the blank cac4d6056fe8ff5_18

3. Calculate the ending inventory of drums for December of the prior year, and for January and February. Round your answers to the nearest whole unit.

Ending inventory for December	fill in the blank cadbdcf9afdbff6_1 units
Ending inventory for January	fill in the blank cadbdcf9afdbff6_2 units
Ending inventory for February	fill in the blank cadbdcf9afdbff6_3 units

4. Prepare a direct materials purchases budget for drums for the months of January and February. Do not include a multiplication symbol as part of your answer.

Patrick Inc.
Direct Materials Purchases Budget - Drums
For the Months of January and February
	January	February
Production in units	fill in the blank ecb2f7fff041043_1	fill in the blank ecb2f7fff041043_2
Drums per unit	fill in the blank ecb2f7fff041043_3	fill in the blank ecb2f7fff041043_4
Drums for production	fill in the blank ecb2f7fff041043_5	fill in the blank ecb2f7fff041043_6
Desired ending inventory	fill in the blank ecb2f7fff041043_7	fill in the blank ecb2f7fff041043_8
Needed	fill in the blank ecb2f7fff041043_9	fill in the blank ecb2f7fff041043_10
Less: Beginning inventory	fill in the blank ecb2f7fff041043_11	fill in the blank ecb2f7fff041043_12
Purchases	fill in the blank ecb2f7fff041043_13	fill in the blank ecb2f7fff041043_14
Price per drum	$fill in the blank ecb2f7fff041043_15	$fill in the blank ecb2f7fff041043_16
Dollar purchases	$fill in the blank ecb2f7fff041043_17	$fill in the blank ecb2f7fff041043_18

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