Direct Materials Purchase Budget.

How to solve Less beginning inventory raw material

Roehler Industrial has estimated that production for the next five quarters will be: Quarter 1, 2017 Quarter 2, 2017 Quarter 3, 2017 Quarter 4, 2017 Quarter 1, 2018 45,000 units 41,000 units 49,000 units 38,000 units 47,000 units Material purchase and requirements for production follow Pounds of raw material required per unit Raw material cost per pound Raw material on hand, beginning of first quarter, 2017 6 $ 7.00 $ 283,500 Roehler desires to have materials on hand at the end of each quarter based on the following: Percentage of next quarter's material requirements 15% Required Prepare quarterly direct materials purchases budgets for Roehler Industries for 2017. Quarter 1 Quarter 2 Quarter 3 Quarter 4 Year Units to be produced 45,000 41,000 49,000 38,000 173,000 Cost of raw material per unit $ 42 $ 42 $ 42 $ 42 $ 42 Cost of raw material needed for production 1,890,000 1,722,000 2,058,000 1,596,000 7,266,000 Add desired ending inventory of raw material 258,300 308,700 239,400 1,089,900 Total material needed 2,148,300 2,030,700 2,297,400 2,686,500 Less beginning inventory of raw material 283,500 Required raw material purchases $ 1,864,800