At the beginning of October, Comfy Cushions had 1,600 cushions and 10,500 pounds of raw materials on

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At the beginning of October, Comfy Cushions had 1,600 cushions and 10,500 pounds of raw materials on hand. Budgeted sales for the next three months are:

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Comfy Cushions wants to have sufficient raw materials on hand at the end of each month to meet 25 percent of the following month’s production requirements and sufficient cushions on hand at the end of each month to meet 20 percent of the following month’s budgeted sales. Five pounds of raw materials, at a standard cost of \($0.90\) per pound, are required to produce each cushion.
Required

a. Prepare a production budget for October and November.

b. Prepare a purchases budget in units and dollars for October.

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Managerial Accounting

ISBN: 9781618532350

8th Edition

Authors: Morse Hartgraves

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