Question

Three grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $2.20 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3: Year 2 Second Third 102,000 162,000 First 72,000 Budgeted production, in bottles Year 3 First 82,000 Fourth 112,000 Musk oil has become so popular as a perfume ingredient that it has become necessary to carry large inventories as a precaution against stock-outs. For this reason, the inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 43,200 grams of musk oil will be on hand to start the first quarter of Year 2. Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. ca Mink Caress Direct Materials Budget - Year 2 Quarter First Second Third Fourth Year Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Total units of raw materials needed Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased

Answer 1

Mink Caress Direct Materials Budget - Year 2 Quarter First Second Third Fourth Year Required production in units of finished goods 72000 102000 162000 112000 448000 Units of Raw material needed per unit of finished goods Units of Raw material needed to meet production 216000 306000 486000 336000 1344000 Add: Desired Units of ending raw materials inventory 61200 97200 67200 49200 49200 Total units of raw materials needed 277200 403200 553200 385200 1393200 Less: Units of beginning raw materials inventory 43200 61200 97200 67200 43200 Units of raw materials to be purchased 234000 342000 456000 318000 1350000 Unit cost of raw materials 2.20 $ 2.20 $ 2.20 $ 2.20 $ 2.20 Cost of raw materials to be purchased $5,14,800.00 $7,52,400.00 $ 10,03,200.00 $ 6,99,600.00 $ 29,70,000.00

Ca 07 - 0 X Calculate Now Watch Window Calculation Calculate Sheet Options Calculation D F FCDDF000 - Microsoft Excel Home Insert Page Layout Formulas Data Review View A a Define Name X-Trace Precedents 5 Show Formulas f Use in Formula Trace Dependents Error Checking Insert AutoSum Recently Financial Logical Text Date & Lookup & Math More Name Function - Used - e Reference & Trig Functions Manager Create from Selection Remove Arrows" Evaluate Formula Function Library Defined Names Formula Auditing A 1 Fax Mink Caress BC Mink Caress Direct Materials Budget - Year 2 Quarter First Second Third Fourth Required production in units of finished goods 72000 102000 162000 112000 Units of Raw material needed per unit of finished goods 3 Units of Raw material needed to meet production =B5*B6 -C5*C6 =D5*D6 -E5*E6 Add : Desired Units of ending raw materials inventory =C7*20% =D7*20% -E7*20% =82000*20%*3 Total units of raw materials needed =B7+B8 =C7+C8 =D7+D8 -E7+E8 10 Less: Units of beginning raw materials inventory 43200 =B8 -C8 11 Units of raw materials to be purchased =B9-B10 -C9-C10 =D9-010 -E9-E10 12 Unit cost of raw materials 2.2 2.2 2.2 13 Cost of raw materials to be purchased =B11*B12 -C11*012 =D11*D12 =E11*E12 Year = SUM(B5:E5) 7 9 =D8 =F5*F6 -E8 =F7+F8 =B10 =F9-F10 2.2 =F11*F12 2.2 Sheet137 Sheet136 Sheet138 Sheet139 Sheet140 Sheet141 Sheet142 Sheet144 Sheet146 Februar Ready Average: 352711.6889 Count: 62 Sum: 15872026 BOU 100% 0 00:03 op ^ 0 ( 1x 24-02-2020 + . O Type here to search