Pasadena Candle Inc. budgeted production of 785,000 candles forJanuary. Wax is required to produce a candle. Assume 10 ounces of waxis required for each candle. The estimated January 1 wax inventory is 16,000 pounds. The desired January $1 wax inventory is 12,500 pounds. Ifcandle wax costs $1.24 per pound, determine the direct materialspurchases budget for January.
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.
Pasadena Candle Inc. budgeted production of 785,000 candles for
January. Wax is required to produce a candle. Assume 10 ounces of wax
is required for each candle. The estimated January 1 wax inventory is
16,000 pounds. The desired January $1 wax inventory is 12,500 pounds. If
candle wax costs $1.24 per pound, determine the direct materials
purchases budget for January.
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