Question

Pasadena Candle Inc. budgeted production of 785,000 candles for January. Wax is required to produce a candle. Assume 10 ounces of wax is required for each candle. The estimated January 1 wax inventory is 16,000 pounds. The desired January 31 wax inventory is 12,500 pounds. If candle wax costs $1.24 per pound, determine the direct materials purchases budget for January. (One pound = 16 ounces.) For those boxes in which you must enter subtracted or negative numbers use a minus sign.

Pasadena Candle Inc.
Direct Materials Purchases Budget
For the Month Ending January 31
Pounds of wax required for production:
Candles or unit price	_____
Desired ending inventory, January 31	____
Total units available	503125
Estimated beginning inventory, January 1	-16000
Total pounds to be purchased	487125
Unit price (per lb.)	1.24
Total direct materials to be purchased in January	604035

Please assist in blanks and bold.

Answer 1

Pounds of wax required for production(785000 candles x 10x1/16 pounds of waxcine)	490625
Desired ending inventory, January 31 in pounds	12500
total units needed(available)	503125
Estimated beginning inventory, January 1	16000
Total pounds to be purchased	487125
Unit price (per lb.)	1.24
Total direct materials to be purchased in January	604035

calculation:-

one pound=16 ounces ,hence wax required in pounds for producing 785000 candles=785000x 10x1/16=490625 pounds.