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Prepare a direct materials purchasing plan for January, February, and March based on the following facts. Global GPS Systems assembles its GPS systems with the
Prepare a direct materials purchasing plan for January, February, and March based on the following facts. Global GPS Systems assembles its GPS systems with the following costs. Each GPS requires one computer system and four bateries. Computer Systems cost $150 each and batteries are $3.75 each. Global is able to reliably obtain computers as needed and does not maintain them in inventory. However, bateries are stocked in inventory sufficient to produce 15% of the following month's expected production. Planned production is as follows: January 24,000 February 39.750 March 23,850 April 25,000 In accordance with the stocking plan January's beginning inventory included 20,000 batteries. Scheduled production January February March Raw materials needed: Motors (1 per unit) Estimated cost per motor Total estimated motor cost Batteries (4 per unit) Plus: Target ending raw material Batteries needed Less: Target beginning raw material Fan battery purchases Estimated cost per battery Total estimated motor battery Total estimated costs (motors + batteries)
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