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Nantucket Industries manufactures and sells two models of watches, Prime and Luxuria. It expects to sell 3,500 units of Prime and 1,300 units of
Nantucket Industries manufactures and sells two models of watches, Prime and Luxuria. It expects to sell 3,500 units of Prime and 1,300 units of Luxuria in 2020. The following estimates are given for 2020: Selling price Direct materials Direct labor Manufacturing overhead Prime $200 30 50 60 Luxuria $ 500 70 190 130 Nantucket had an inventory of 200 units of Prime amd 105 units of Luxuria at the end of 2019. It has decided that as a measure to counter stock outages it will maintain ending inventory of 390 units of Prime and 250 units of Luxuria. Each Luxuria watch requires one unit of Crimpson and has to be imported at a cost of $14. There were 140 units of Crimpson in stock at the end of 2019. The management does not want to have any stock of Crimpson at the end of 2020. What is the amount budgeted for purchase of Crimpson in 2020? A. $51,660 B. $18,270 C. $20,230 OD. $18,200
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