Wildhorse Ltd. estimates sales for the second quarter of 2022 will be as follows. Month April May June Units March 31 April 30 May 31 June 30 3,090 3,190 2,960 The target ending inventory of finished products is as follows. 2,440 2,620 2,600 2,900 Two units of materials are required for each unit of finished product. Production for July is estimated at 3,210 units to start building inventory for the fall sales period. Wildhorse's policy i to have an inventory of raw materials at the end of each month equal to 50% of the following month's production requirements. Raw materials are expected to cost $4 per unit throughout the period. Calculate the May raw materials purchases in dollars. Raw material purchases cost $

Wildhorse Ltd. estimates sales for the second quarter of 2022 will be as follows. Month April May June Units March 31 April 30 May 31 June 30 3,090 3,190 2,960 The target ending inventory of finished products is as follows. 2,440 2,620 2,600 2,900 Two units of materials are required for each unit of finished product. Production for July is estimated at 3,210 units to start building inventory for the fall sales period. Wildhorse's policy i to have an inventory of raw materials at the end of each month equal to 50% of the following month's production requirements. Raw materials are expected to cost $4 per unit throughout the period. Calculate the May raw materials purchases in dollars. Raw material purchases cost $

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

Inventory Accounting

Inventory accounting is that branch of accounting that helps in determining the specific value of assets at different stages of production and development.

Question

100%

Wildhorse Ltd. estimates sales for the second quarter of 2022 will be as follows.
Month
April
May
June
Units
March 31
April 30
May 31
June 30
3,090
3,190
2,960
The target ending inventory of finished products is as follows.
2,440
2,620
2,600
2,900
Two units of materials are required for each unit of finished product. Production for July is
estimated at 3,210 units to start building inventory for the fall sales period. Wildhorse's policy is
to have an inventory of raw materials at the end of each month equal to 50% of the following
month's production requirements.
Raw materials are expected to cost $4 per unit throughout the period.
Calculate the May raw materials purchases in dollars.
Raw material purchases cost

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