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Yogi expects to produce 1,950 units in January and 2,130 units in February. The company budgets four pounds per unit of direct materials at a
Yogi expects to produce 1,950 units in January and 2,130 units in February. The company budgets four pounds per unit of direct materials at a cost of $40 per pound. Indirect materials are insignificant and not considered for budgeting purposes. The balance in the Raw Materials Inventory account (all direct materials) on January 1 is 5,400 pounds. Yogi desires the ending balance in Raw Materials Inventory to be 60% of the next month's direct materials needed for production. Desired ending balance for February is 4,800 pounds. Prepare Yogi's direct materials budget for January and February Begin by preparing the direct materials budget for January and February through total direct materials needed line and then complete the budget by calculating the budgeted cost of direct materials purchases. Yogi Company Direct Materials Budget Two Months Ended January 31 and February 28 January February Direct materials (pounds) per unit Direct materials needed for production Plus: Total direct materials needed
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