Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

accounting and finance MUMFORD Company is budgeting for the calendar year 2023. It is forecasted that the company will sell a total of 30,000 bookshelves

accounting and finance
image text in transcribed
MUMFORD Company is budgeting for the calendar year 2023. It is forecasted that the company will sell a total of 30,000 bookshelves during 2023 evenly for each quarter. These bookshelves will be sold at a price of $125 per bookshelf, for the first 3 quarters and then the selling price is budgeted to be increased to $145 per bookshelf. Management has a policy to always have 10% of the next quarter's projected sales quantity available in finished goods inventory at the end of each quarter. The primary (direct) material used for the manufacture of these bookshelves is plastic. Each bookshelf requires 5 pounds of plastic. The current cost of plastic is $8 per pound and is expected to remain unchanged for all of 2023. As at January 1, 2023 management expects to have 6,000 pounds of plastic in inventory. Management also desires to have 2,000 pounds of plastic in invent yy at the end of 2023 as safety stock. It is forecasted that a total of 9,000 bookshelves will be sold in the first quarter of 2024. Required: Prepare the Direct Materials Budget in dollars for 2023. (Ensure that all parts of your answer are clearly labeled and rounded to 2 decimal places.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cross-Border Mergers And Acquisitions UK Dimensions

Authors: Moshfique Uddin, Agyenim Boateng

1st Edition

0415836603, 9780415836609

More Books

Students also viewed these Accounting questions