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Electro Company budgets production of 450,000 transmissions in the second quarter and 520,000 transmissions in the third quarter Each transmission requires 0.80 pounds of a
Electro Company budgets production of 450,000 transmissions in the second quarter and 520,000 transmissions in the third quarter Each transmission requires 0.80 pounds of a key raw material. The company aims to end each quarter with an ending inventory of direct materials equal to 20% of next quarter's budgeted materials requirements. Beginning inventory of this raw material is 72,000 pounds. Direct materials cost $1.70 per pound. Prepare a direct materials budget for the second quarter. ELECTRO COMPANY Direct Materials Budget Budgeted production (units) Second Quarter Materials needed for production (lbs.) Total materials requirements (lbs.) Materials to be purchased (lbs.) Budgeted cost of direct materials purchases 450,000 units ELECTRO COMPANY Direct Materials Budget Second Quarter Budgeted production (units) AA- Budgeted beginning inventory (lbs.) Budgeted ending inventory (lbs.) Budgeted units sales for month Materials price per pound 450,000 units ELECTRO COMPANY Direct Materials Budget Second Quarter Budgeted production (units) A.A.- Budgeted beginning inventory (lbs.) Budgeted ending inventory (lbs.) Budgeted units sales for month Materials price per pound 450,000 units
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