Question

Required: 1. Prepare a production budget for Supermix for the months July, August, September, and October. 3. Prepare a direct materials budget showing the quantity of solvent H300 to be purchased for July, August, and September, and for the quarter in total. Complete this question by entering your answers in the tabs below. Required 1 Required 3 Prepare a direct materials budget showing the quantity of solvent H300 to be purchased for July, August, and September, and for the quarter in total. August 186,000 |cc September 198,000 Third Quarter 552,000 CC CC Pearl Products Limited Direct Materials Budget July Required production in units of finished goods 168,000 Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Desired units of ending raw materials inventory 93,000 Total units of raw materials needed 261,000 Less: Units of beginning raw materials inventory 74,000 Units of raw materials to be purchased 187,000 99,000 285,000 93,000 192,000 72,000 270,000 98,000 172,000 264,000 816,000 266,000 551,000 Droof 11 Maut

Answer 1

Solution

Pearl Products Limited
Production budget
	July	August	September	October
Units to be sold	55000	60000	70000	50000
Desired Ending Finished Inventory	14000	16000	12000*	10000
Total Units needed	69000	76000	82000	60000
Less : Beginning Finished Inventory	13000	14000	16000	12000
Units to be Produced	56000	62000	66000	48000

*40000 x 20%+ (2000)

Pearl Products Limited
Direct Materials Budget
for the month of------
	July	August	September	Third Quarter
Budgeted production (units)	56000	62000	66000	184000
Materials requirements per unit	3	3	3	3
Materials needed for production (cc)	168000	186000	198000	552000
Budgeted ending inventory (cc.)	93000	99000	72000*	72000
Total materials requirements (cc.)	261000	285000	270000	624000
Beginning inventory (cc.)	84000	93000	99000	84000
Materials to be purchased (cc.)	177000	192000	171000	540000

*48000 x 3 x 50%