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Zira Company reports the following production budget for the next four months. Each finished unit requires five pounds of direct materials, and the company wants
Zira Company reports the following production budget for the next four months. Each finished unit requires five pounds of direct materials, and the company wants to end each month with direct materials inventory equal to 30% of next months production needs. Beginning direct materials inventory for April was 683 pounds. Direct materials cost $4 per pound.
Prepare a direct materials budget for April, May, and June.
Note: Round your answers to the nearest whole number.
April | May | June | July | |
---|---|---|---|---|
Units to produce | 455 | 570 | 560 | 540 |
\begin{tabular}{|c|c|c|c|c|c|c|c|} \hline \multicolumn{8}{|c|}{ ZIRA COMPANY } \\ \hline \multicolumn{8}{|c|}{ Direct Materials Budget } \\ \hline & & & & & & & \\ \hline Units to produce & & 455 & & 570 & & 560 & units \\ \hline Materials required per unit & & 5 & & 5 & & 5 & pounds \\ \hline Materials needed for production (pounds) & & 2,275 & & 2,850 & & 2,800 & pounds \\ \hline \multicolumn{8}{|c|}{ Add: Desired ending materials inventory (pounds) } \\ \hline Total materials required (pounds) & & 2,275 & & 2,850 & & 2,800 & pounds \\ \hline \multicolumn{8}{|l|}{ Less: Beginning materials inventory (pounds) } \\ \hline \multicolumn{8}{|l|}{ Materials to purchase (pounds) } \\ \hline Materials cost per pound & $ & 4 & $ & 4 & $ & 4 & per pound \\ \hline Cost of direct materials purchases & $ & 0 & $ & 0 & $ & 0 & \\ \hline \end{tabular}
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