Two grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in westernSiberia. The cost of the musk oil is $1.80 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and fothe first quarter of Year 3:Year 2Year 3FirstSecondThirdFourthFirstBudgeted production, in bottles80,000110,000170,000120,00090,000The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 32,000grams of musk oil will be on hand to start the first quarter of Year 2.Required:Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2.Mink CaressDirect Materials Budget - Year 2QuarterFirstSecondThirdFourthYearRequired production in units of finished goods80,000110,000170,000120,000480,000Units of raw materials needed per unit of finished goods44,000Units of raw materials needed to meet production3,520,000,000< Prev3 of 10Next >arch(hp|道” - --- --Mink CaressDirect Materials Budget - Year 2QuarterFirstSecondThirdFourthYearRequired production in units of finished goods80,000110,000170,000120,000480,000Units of raw materials needed per unit of finished goods44,000Units of raw materials needed to meet production3,520,000,000Total units of raw materials needed44,000es44,000Units of raw materials to be purchased44,000Unit cost of raw materialsCost of raw materials to purchased< Prev3 of 10Next >o searchhn

Budgeted production estimates are very useful in planning. Following is the estimation for the given…

The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's pr grams of musk oil will be on hand to start the first quarter of Year 2. Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Mink Caross

The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's pr grams of musk oil will be on hand to start the first quarter of Year 2. Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Mink Caross

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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Concept explainers

Master Budget

A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.

Sales Budget and Selling

A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.

Question

100%

Two 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 $1.80 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and fo
the first quarter of Year 3:
Year 2
Year 3
First
Second
Third
Fourth
First
Budgeted production, in bottles
80,000
110,000
170,000
120,000
90,000
The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 32,000
grams of musk oil will be on hand to start the first quarter of Year 2.
Required:
Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2.
Mink Caress
Direct Materials Budget - Year 2
Quarter
First
Second
Third
Fourth
Year
Required production in units of finished goods
80,000
110,000
170,000
120,000
480,000
Units of raw materials needed per unit of finished goods
44,000
Units of raw materials needed to meet production
3,520,000,000
< Prev
3 of 10
Next >
arch
(hp
|道”

- --- --
Mink Caress
Direct Materials Budget - Year 2
Quarter
First
Second
Third
Fourth
Year
Required production in units of finished goods
80,000
110,000
170,000
120,000
480,000
Units of raw materials needed per unit of finished goods
44,000
Units of raw materials needed to meet production
3,520,000,000
Total units of raw materials needed
44,000
es
44,000
Units of raw materials to be purchased
44,000
Unit cost of raw materials
Cost of raw materials to purchased
< Prev
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Four grams of musk oil are required for each bottle of Mink Caress, a popular perfume made by a company in western Siberia. The cost of the musk oil is $2.10 per gram. Budgeted quarterly production of Mink Caress is given below for Year 2 and the first quarter of Year 3: Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production First 98,000 Total units of raw materials needed Year 2 Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Second 128,000 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 equal 20% of the following quarter's production needs. A total of 78,400 grams of musk oil will be on hand to start the first quarter of Year 2. Third 188,000 Mink Caress Direct Materials Budget - Year 2 First Fourth 138,000 Second Quarter Year 3 First 108,000 Third…
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