Question

#2

Direct Materials Purchases Budget

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	15,300		21,700

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.	220	lbs.	300	lbs.
Desired inventory, September 30	620	lbs.	210	lbs.	330	lbs.
Price per pound	$1.10		$2.30		$3.10

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
Total units available
Total units to be purchased
Unit Price	x $	x $	x $
Total direct materials to be purchased	$	$	$	$

Answer 1

	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	13770	9180	12240
16" pizza	32550	21700	28210
Plus: Desired inventory, September 30	620	210	330
Total units available	46940	31090	40780
Less: Estimated inventory, September 1	-590	-220	-300
Total units to be purchased	46350	30870	40480
Unit price	1.10	2.30	3.10
Total direct materials to be purchased	50985	71001	125488	247474