XYZ Manufacturing production budget for April: 40,000 units Budgeted materials per unit: Direct material “A”: 2 gallons per unit @ $5.00 per gallon Direct material “B”: 6 lbs. per unit @ $8.00 per lb. Budgeted materials inventory: April 1 Direct material “A”: 5,000 gallons Direct material “B”: 8,000 lbs. April 30 Direct material “A”: 6,000 gallons Direct material “B”: 8,000 lbs. REQUIRED: Direct material “A” purchasing budget for the month of April in gallons and dollars: DM “A” _____________gallons DM “A” $__________________ Direct material “B” purchasing budget for the month of April in pounds and dollars: DM “B”_____________ pounds DM “B” $__________________
XYZ Manufacturing production budget for April: 40,000 units
Budgeted materials per unit:
Direct material “A”: 2 gallons per unit @ $5.00 per gallon
Direct material “B”: 6 lbs. per unit @ $8.00 per lb.
Budgeted materials inventory:
April 1 Direct material “A”: 5,000 gallons
Direct material “B”: 8,000 lbs.
April 30 Direct material “A”: 6,000 gallons
Direct material “B”: 8,000 lbs.
REQUIRED:
- Direct material “A” purchasing budget for the month of April in gallons and dollars:
DM “A” _____________gallons
DM “A” $__________________
- Direct material “B” purchasing budget for the month of April in pounds and dollars:
DM “B”_____________ pounds
DM “B” $__________________
The production budget is prepared by the management to find out the units to be produced. It can be calculated by adding up ending inventory and deduction beginning inventory from the required production.
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