Question

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

	Units
	12" Pizza		16" Pizza
Budgeted production volume	15,600		25,100

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, Romano's has determined the following information about each material:

	Dough		Tomato		Cheese
Estimated inventory, September 1	590	lbs.	160	lbs.	330	lbs.
Desired inventory, September 30	620	lbs.	160	lbs.	360	lbs.
Price per pound	$1.20		$2.60		$3.30

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

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

Answer 1

Answer:-

Romano's Frozen Pizza Inc.
Direct Materials Purchase Budget
For the month ending September 30
Particulars	Dough	Tomato	Cheese	Total
Units required for production:
12" pizza	15600 units*.90 lb per unit =14040 lbs	15600 units*.60 lb per unit =9360 lbs	15600 units*.80 lb per unit =12480 lbs	35880
16" pizza	25100 units*1.50 lb per unit =37650 lbs	25100 units*1.00 lb per unit =25100 lbs	25100 units*1.30 lb per unit =32630 lbs	95380
Add:-Beginning inventory	590	160	330	1080
Less:- Closing Inventory	620	160	360	1140
Total units to be purchased (a)	51660	34460	45080	131200
Unit price (b)	$1.20	$2.60	$3.30
Total direct materials to be purchased (c=a*b)	61992	89596	148764	300352