Question
Croy Inc. has the following projected sales for the next five months: Month Sales in Units April 3,530 May 3,850 June 4,540 July 4,195 August
Croy Inc. has the following projected sales for the next five months:
Month | Sales in Units |
April | 3,530 |
May | 3,850 |
June | 4,540 |
July | 4,195 |
August | 3,970 |
Croys finished goods inventory policy is to have 50 percent of the next months sales on hand at the end of each month. Direct materials costs $3.30 per pound, and each unit requires 2 pounds. Direct materials inventory policy is to have 50 percent of the next months production needs on hand at the end of each month. Direct materials on hand at March 31 totaled 3,690 pounds.
Required:
1. Determine budgeted production for April, May, and June.
2. Determine budgeted cost of materials purchased for April and May.
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