Question

Caspion Corporation makes and sells a product called a Miniwarp. One Miniwarp requires 9.5 kilograms of...

Caspion Corporation makes and sells a product called a Miniwarp. One Miniwarp requires 9.5 kilograms of the raw material Jurislon. Budgeted production of Miniwarps for the next five months is as follows:

August 24,200 units
September 22,900 units
October 24,300 units
November 25,500 units
December 25,200 units

The company wants to maintain monthly ending inventories of Jurislon equal to 20% of the following month's production needs. On July 31, this requirement was not met since only 12,400 kilograms of Jurislon were on hand. The cost of Jurislon is $23 per kilogram. The company wants to prepare a Direct Materials Purchase Budget for the next five months.

The total cost of Jurislon to be purchased in August is:

Multiple Choice

  • $6,003,230

  • $6,288,430

  • $5,287,700

  • $1,695,100
Business   Accounting   
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Answer #1

ANSWER:

Given the data :

August 24,200 units
September 22,900 units
October 24,300 units
November 25,500 units
December 25,200 units


So the correct option is $6003, 230

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