Question
Smith Company expects to sell 5,000 units Each unit requires: 2 pounds of direct material at $10 per pound 2 direct labor hours at $12
Smith Company expects to sell 5,000 units
Each unit requires:
2 pounds of direct material at $10 per pound
2 direct labor hours at $12 per credit labor hour
The manufacturing overhead rate is $7 per direct labor hour.
The beginning inventories are as follows:
Direct materials: 1,000 pounds
Finished goods: 2,500 units
The planned ending inventories are as follows:
Direct materials: 2,ooo pounds
Finished Goods 1,500 units
Required:
1. What is the planned production?
2. What are the required direct material purchases for the planned production?
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Get StartedRecommended Textbook for
Horngrens Financial and Managerial Accounting
Authors: Tracie L. Nobles, Brenda L. Mattison, Ella Mae Matsumura
5th edition
9780133851281, 013385129x, 9780134077321, 133866297, 133851281, 9780133851298, 134077326, 978-0133866292
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