Question

Tobin’s Frozen Pizza Inc. has determined from its production budget the following estimated production volumes for 12'' and 16'' frozen pizzas for November:

	Units
	12" Pizza		16" Pizza
Budgeted production volume	12,800		20,800

There are three direct materials used in producing the two types of pizza. The quantities of direct materials expected to be used for each pizza are as follows:

		12" Pizza		16" Pizza
Direct materials:
	Dough	0.90	lb. per unit	1.50	lbs. per unit
	Tomato	0.60		1.00
	Cheese	0.80		1.30

In addition, Tobin's has determined the following information about each material:

	Dough		Tomato		Cheese
Estimated inventory, November 1	560	lbs.	220	lbs.	340	lbs.
Desired inventory, November 30	590	lbs.	210	lbs.	370	lbs.
Price per pound	$1.30		$2.70		$3.00

Prepare November's direct materials purchases budget for Tobin’s Frozen Pizza Inc. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

Tobin’s Frozen Pizza Inc.
Direct Materials Purchases Budget
For the Month Ending November 30
	Direct Materials	Direct Materials	Direct Materials
	Dough	Tomato	Cheese	Total
Units required for production:
12" pizza
16" pizza
Desired inventory, November 30
Total units available
Estimated inventory, November 1
Total units to be purchased
Unit Price	x $	x $	x $
Total direct materials to be purchased	$	$	$	$

Answer 1

Solution

Tobin’s Frozen Pizza Inc.
Direct Materials Purchases Budget
For the Month Ending September 30
	Dough	Tomato	Cheese	Total
Units required for production:
12" pizza	11520	7680	10240
16" pizza	31200	20800	27040
Desired ending inventory	590	210	370
Total pounds required	43310	28690	37650
Less: Beginning inventory	560	220	340
Total units to be purchased	42750	28470	37310
Unit price	$        1.30	$        2.70	$          3.00
Total direct materials to be purchased	$55,575.00	$76,869.00	$111,930.00	$244,374.00