Question

Fantastic Futons buys direct materials for the futons in cloth rolls priced at $80 each. Each...

Fantastic Futons buys direct materials for the futons in cloth rolls priced at $80 each. Each roll provides direct material for 40 futons. There was two (2) rolls in the direct materials inventory at the beginning of January, and the company expects to have four (4) rolls in inventory at the end of the month. Assuming the production budget calls for 50,000 futons to be produced in January, what would be the amount of the direct materials purchase budget for the cloth rolls for January? After calculating the number of rolls needed, you need to calculate $.

Homework Answers

Answer #1

Part a)

Direct material Purchases in number of rolls

= desired ending inventory + required for production - beginning inventory

= 4 +(50000/40) - 2

= 4 + 1250 - 2

= 1252

Thus the correct answer Number of rolls to be purchased = 1252 rolls

Part 2)

Amount of direct material purchases

= number of rolls to be purchased * price per unit

= 1252 *80

= $ 100160

Thus the correct answer direct material purchases in dollars = $ 100160

For any other help please comment in the comment box

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Smith Industries manufactures a popular interactive stuffed animal for children that requires four computer chips inside...
Smith Industries manufactures a popular interactive stuffed animal for children that requires four computer chips inside each toy. The company pays $ 2 for each computer chip. To help to guard against stockouts of the computer​ chip, Smith Industries has a policy that states that the ending inventory of computer chips should be at least 20​% of the following​ month's production needs. The production schedule for the first four months of the year is as​ follows: Stuffed animals to be...
ELECTRO COMPANY Direct Materials Budget Second Quarter Budgeted production (units) 550,000 units Materials needed for production...
ELECTRO COMPANY Direct Materials Budget Second Quarter Budgeted production (units) 550,000 units Materials needed for production (lbs.) Total materials requirements (lbs.) Materials to be purchased (lbs.) Budgeted cost of direct materials purchases Electro Company budgets production of 550,000 transmissions in the second quarter and 625,000 transmissions in the third quarter. Each transmission requires 0.8 pounds of a key raw material. The Company aims to end each quarter with an ending inventory of direct materials equal to 20% of next quarter’s...
Direct Materials Purchases Budget Langer Company produces plastic items, including plastic housings for humidifiers. Each housing...
Direct Materials Purchases Budget Langer Company produces plastic items, including plastic housings for humidifiers. Each housing requires about 19 ounces of plastic costing $0.16 per ounce. Langer molds the plastic into the proper shape. Langer has budgeted production of the housings for the next 4 months as follows: Units July 3,500 August 4,400 September 4,900 October 6,300 Inventory policy requires that sufficient plastic be in ending monthly inventory to satisfy 30% of the following month's production needs. The inventory of...
Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin Greiner Company makes and sells high-quality...
Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner’s master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer’s share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company’s union contract calls for an increase in direct...
Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin Greiner Company makes and sells high-quality...
Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner’s master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer’s share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company’s union contract calls for an increase in direct...
3. Troy Corporation has the following budgeted sales for the selected four-month period: Month Unit Sales...
3. Troy Corporation has the following budgeted sales for the selected four-month period: Month Unit Sales October 40,000 November 70,000 December 50,000 January 60,000 There were 14,000 units of finished goods in inventory at the beginning of October. Plans are to have an inventory of finished product equal to 25 percent of the unit sales for the next month. Five pounds of a single raw material are required for each unit produced. Each pound of material costs $10. Plans are...
RAMOS CO. Direct Materials Budget For April, May, and June April May June Budget production (units)...
RAMOS CO. Direct Materials Budget For April, May, and June April May June Budget production (units) 600 730 700 units Materials needed for production (lbs.) Total materials requirements (lbs.) Materials to be purchased (lbs.) Materials price per pound Budgeted cost of direct materials purchases Required information Ramos Co. provides the following sales forecast and production budget for the next four months. April May June July Sales (units) 660 740 690 760 Budgeted production (units) 600 730 700 700 The company...
Company expects to produce and sell12,000 units for $80 DM costs are $8 DL is $40...
Company expects to produce and sell12,000 units for $80 DM costs are $8 DL is $40 MOH is $12 per unit                                                     Beginning inventory                                Target Ending inventory Finished goods inventory           800 units                                           1000 units On the 2020 budgeted income statement, what amount will be reported for sales? (4 points) A. $960,000 B. $860,000 C. $80,000 D. $24,000 Company expects to produce and sell12,000 units for $80 DM costs are $8 DL is $40 MOH is $12 per unit                                                     Beginning inventory                                Target Ending inventory Finished...
Production Budget and Direct Materials Purchases Budget Jani Subramanian, owner of Jani's Flowers and Gifts, produces...
Production Budget and Direct Materials Purchases Budget Jani Subramanian, owner of Jani's Flowers and Gifts, produces gift baskets for various special occasions. Each gift basket includes fruit or assorted small gifts (e.g., a coffee mug, deck of cards, novelty cocoa mixes, scented soap) in a basket that is wrapped in colorful cellophane. Jani has estimated the following unit sales of the standard gift basket for the rest of the year and for January of next year. September 250 October 200...
The total direct materials purchases (assuming no beginning or ending inventory of material) of Materials A...
The total direct materials purchases (assuming no beginning or ending inventory of material) of Materials A and B required for August production is a. $1,080,000 for A; $1,296,000 for B b. $1,080,000 for A; $648,000 for B c. $1,125,000 for A; $675,000 for B d. $1,170,000 for A; $702,000 for B        The Cardinal Company had a finished goods inventory of 55,000 units on January 1. Its projected sales for the next four months were: January - 200,000 units; February -...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT