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Morganton Company makes one product and it provided the following information to help prepare the master budget for its four months of operations: (a) The

Morganton Company makes one product and it provided the following information to help prepare the master budget for its four months of operations:


(a)

The budgeted selling price per unit is $70. Budgeted unit sales for June, July, August, and September are 9,100, 22,000, 24,000, and 25,000 units, respectively. All sales are on credit.

(b) Forty-percent of credit sales are collected in the month of the sale and 60% in the following month.
(c) The ending finished goods inventory equals 20% of the following months unit sales.
(d)

The ending raw materials inventory equals 10% of the following months raw materials production needs. Each unit of finished goods requires 4 pounds of raw materials. The raw materials cost $2.50 per pound.

(e) Forty-percent of raw materials purchases are paid for in the month of purchase and 60% in the following month.
(f)

The direct labor wage rate is $12 per hour. Each unit of finished goods requires two direct labor-hours.

(g)

The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense per month is $61,000.


If 96,800 pounds of raw materials are needed to meet production in August, how many pounds of raw materials should be purchased in July?

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