Question

Waterway Auto has developed the following production plan for its new auto part. January February March...

Waterway Auto has developed the following production plan for its new auto part.

January February March April
Budgeted production (units) 11,600 8,600 9,960 14,940


Each unit contains 3 pounds of raw material. The desired raw materials ending inventory is 132% of the next month’s production needs, plus an additional 504 pounds. January's beginning inventory requirements equal 132% of the current month's production needs, plus an additional 504 pounds.

Prepare the direct materials purchases budget for the first three months of the coming year. (Round answers to 0 decimal places, e.g. 5,275.)

January February March Quarter

Budgeted production

Standard pounds per unit

Production needs

Budgeted ending inventory

Total DM required (lbs.)

Beginning inventory

Budgeted purchases (lbs.)

Homework Answers

Answer #1

Prepare the direct materials purchases budget for the first three months of the coming year. (Round answers to 0 decimal places, e.g. 5,275.)

January February March Quarter

Budgeted production

11600 8600 9960 30160

Standard pounds per unit

3 3 3 3

Production needs

34800 25800 29880 90480

Budgeted ending inventory

34560 39946 59666 59666

Total DM required (lbs.)

69360 65746 89546 150146

Beginning inventory

-46440 -34560 -39946 -46440
Budgeted purchases (lbs.) 22920 31186 49600 103706
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