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Sales in Units 3,430 3,915 4,560

Sales in Units 3,430 3,915 4,560

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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Qw.32.

Croy Inc. has the following projected sales for the next five months: Month Sales in Units April 3,430 May 3,915 June 4,560 July 4,165 August 3,960 Croy's finished goods inventory policy is to have 50 percent of the next month's sales on hand at the end of each month. Direct materials costs $3.10 per pound, and each unit requires 2 pounds. Direct materials inventory policy is to have 50 percent of the next month's production needs on hand at the end of each month. Direct materials on hand at March 31 totaled 3,673 pounds. Required: 1. Determine budgeted production for April, May, and June. 2. Determine budgeted cost of materials purchased for April and May.
Transcribed Image Text:Croy Inc. has the following projected sales for the next five months: Month Sales in Units April 3,430 May 3,915 June 4,560 July 4,165 August 3,960 Croy's finished goods inventory policy is to have 50 percent of the next month's sales on hand at the end of each month. Direct materials costs $3.10 per pound, and each unit requires 2 pounds. Direct materials inventory policy is to have 50 percent of the next month's production needs on hand at the end of each month. Direct materials on hand at March 31 totaled 3,673 pounds. Required: 1. Determine budgeted production for April, May, and June. 2. Determine budgeted cost of materials purchased for April and May.
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