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What are the materials purchases costs for February?

What are the materials purchases costs for February?

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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What are the materials purchases costs for February? Material purchases for February $ eTextbook and Media Save for Later
Transcribed Image Text:What are the materials purchases costs for February? Material purchases for February $ eTextbook and Media Save for Later
The controller of Coronado Company estimates sales and production for the first four months of 2022 as follows: Sales Production in units January $28,700 1,100 February March $38,200 1,500 April $50,900 $25,800 1,800 2,800 Sales are 40% cash and 60% on account, and 60% of credit sales are collected in the month of the sale. In the month after the sale, 40% of credit sales are collected. It takes 4 kg of direct materials to produce a finished unit, and direct materials cost $5 per kg. All direct materials purchases are on account, and are paid as follows: 40% in the month of the purchase and 60% the following month. Ending direct materials inventory for each month is 40% of the next month's production needs. January's beginning materials inventory is 1,010 kg. Suppose that both accounts receivable and accounts payable are zero at the beginning of January.
Transcribed Image Text:The controller of Coronado Company estimates sales and production for the first four months of 2022 as follows: Sales Production in units January $28,700 1,100 February March $38,200 1,500 April $50,900 $25,800 1,800 2,800 Sales are 40% cash and 60% on account, and 60% of credit sales are collected in the month of the sale. In the month after the sale, 40% of credit sales are collected. It takes 4 kg of direct materials to produce a finished unit, and direct materials cost $5 per kg. All direct materials purchases are on account, and are paid as follows: 40% in the month of the purchase and 60% the following month. Ending direct materials inventory for each month is 40% of the next month's production needs. January's beginning materials inventory is 1,010 kg. Suppose that both accounts receivable and accounts payable are zero at the beginning of January.
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