Question
Direct Materials Purchases Budget Anticipated sales for Sure Grip Tire Company were 38,000 passenger car tires and 11,000 truck tires. Rubber and steel belts are
Direct Materials Purchases Budget
Anticipated sales for Sure Grip Tire Company were 38,000 passenger car tires and 11,000 truck tires. Rubber and steel belts are used in producing passenger car and truck tires according to the following table:
Passenger Car | Truck | |
Rubber | 28 lbs. per unit | 65 lbs. per unit |
Steel belts | 4 lbs. per unit | 10 lbs. per unit |
The purchase prices of rubber and steel are $3.6 and $4.7 per pound, respectively. The desired ending inventories of rubber and steel belts are 36,000 and 7,000 pounds, respectively. The estimated beginning inventories for rubber and steel belts are 42,000 and 6,000 pounds, respectively.
Prepare a direct materials purchases budget for Sure Grip Tire Company for the year ended December 31, 2016. When required, enter unit prices to the nearest cent.
Sure Grip Tire Company | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Direct Materials Purchases Budget | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
For the Year Ending December 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rubber | Steel Belts | Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pounds required for production: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Passenger tires | lbs. | lbs. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Truck tires | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Plus desired inventory, December 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | lbs. | lbs. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Less estimated inventory, January 1, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total units purchased | lbs. | lbs. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unit price | x $ | x $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total direct materials to be purchased | $ | $ | $Direct Materials Purchases Budget Anticipated sales for Sure Grip Tire Company were 38,000 passenger car tires and 11,000 truck tires. Rubber and steel belts are used in producing passenger car and truck tires according to the following table:
The purchase prices of rubber and steel are $3.6 and $4.7 per pound, respectively. The desired ending inventories of rubber and steel belts are 36,000 and 7,000 pounds, respectively. The estimated beginning inventories for rubber and steel belts are 42,000 and 6,000 pounds, respectively. Prepare a direct materials purchases budget for Sure Grip Tire Company for the year ended December 31, 2016. When required, enter unit prices to the nearest cent.
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