Question
Research Company sells modems. Research desires to hold a finished goods inventory equal to 100% of the next month's sales requirement of modems. The beginning
Research Company sells modems. Research desires to hold a finished goods inventory equal to 100% of the next month's sales requirement of modems. The beginning finished goods inventory is 1,200 units. Foretasted unit sales for April and the next three months are as follows:
April May June July
800 850 925 1,000
The production of one finished unit requires 5 pounds of raw material. The company desires to have a one-month supply of raw materials as the ending inventory for each month. The beginning inventory of raw materials is 6,190 pounds.
Required:
Prepare a direct materials purchases budget (in pounds) for April.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
To determine the required production and raw material purchases for each month we need to calculate the production requirements and raw material usage ...Get Instant Access to Expert-Tailored Solutions
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Step: 2
Step: 3
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