The Caribbean Industrial Producers manufactures two products, “Zinc” and” “Ply”. The following sales forecast for 2016 was decided on by the budget committee and presented to you the management accountant.                                                     Sales forecast Details Zinc/units   Ply /units December 2015 6,000 3,700 January 2016 5,500 4,000 February 2016 6,200 4,500 March 2016 5,000 5,400 April 2016 4,900 5,200 May 2016 6,400 4,800   Notes: (i) During 2016 the company sold one unit of Zinc for $1,200 while one unit of Ply was sold for $$1,500. (ii) To make one unit of Zinc four units of raw material BZN980 are used, while two units of raw material CZN980 are used to produce one unit of Ply.​​​​. (iii) Raw materials stock in units at the end of each month is to be held at a level equal to twenty percent (20 %) of the forecasted sales for the previous month. (iv) It was decided by management that at the end of each month there should be enough finished goods stock on hand to meet fifteen (15%) of the sales for the next month. (v) During 2016, direct raw material charge per unit was budgeted at ten percent (10%) of the unit selling price of the finished products.   Required:   For the period, January 2016 to April 2016 do the following: (c) The direct raw materials usage budget for both products. ​​

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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The Caribbean Industrial Producers manufactures two products, “Zinc” and” “Ply”. The following sales forecast for 2016 was decided on by the budget committee and presented to you the management accountant.

                                                    Sales forecast

Details

Zinc/units  

Ply /units

December 2015

6,000

3,700

January 2016

5,500

4,000

February 2016

6,200

4,500

March 2016

5,000

5,400

April 2016

4,900

5,200

May 2016

6,400

4,800

 

Notes:

(i) During 2016 the company sold one unit of Zinc for $1,200 while one unit of Ply was sold for $$1,500.

(ii) To make one unit of Zinc four units of raw material BZN980 are used, while two units of raw material CZN980 are used to produce one unit of Ply.​​​​.

(iii) Raw materials stock in units at the end of each month is to be held at a level equal to twenty percent (20 %) of the forecasted sales for the previous month.

(iv) It was decided by management that at the end of each month there should be enough finished goods stock on hand to meet fifteen (15%) of the sales for the next month.

(v) During 2016, direct raw material charge per unit was budgeted at ten percent (10%) of the unit selling price of the finished products.

 

Required:

 

For the period, January 2016 to April 2016 do the following:

(c) The direct raw materials usage budget for both products. ​​                    
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