Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

IRWIN TECH sales in June were 400,000 units. Sales are expected to increase by 2% each month during the next 2 months (July and August)

IRWIN TECH sales in June were 400,000 units. Sales are expected to increase by 2% each month during the next 2 months (July and August) and an additional 8,000 units in September from August amount. Selling price is $16 per unit. Expected sales in October are 420,000 units. The firm inventory policy is to maintain an ending inventory equal to 25% of next month sales. Actual inventory is 103,000 units.

Each unit requirements are as follows:

.75 pounds of materials per unit

36 minutes of labor per hour

variable overhead is allocated as 60% of labor

Material cost is $6 per pound, labor cost is $10.50 per hour and fixed overhead is $105,000 monthly. Budgeted production units for October are 430,000 units and actual materials inventory is 95,000 pounds. Materials inventory policy is 30% of next month production.

Calculate expected direct materials cost in July.

Step by Step Solution

3.46 Rating (153 Votes )

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

Data Analysis And Decision Making

Authors: Christian Albright, Wayne Winston, Christopher Zappe

4th Edition

538476125, 978-0538476126

More Books

Students also viewed these Accounting questions

Question

Solve this system of equations -3x-y 5 -3x - 4y 83 || y = 1 11

Answered: 1 week ago

Question

Where do you see yourself in 5/10 years?

Answered: 1 week ago