E8-21 (Algo) Preparing Production and Direct Materials Purchases Budgets [LO 8-3b] Galactic Inc. manufactures flying drone...

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E8-21 (Algo) Preparing Production and Direct Materials Purchases Budgets [LO 8-3b] Galactic Inc. manufactures flying drone to

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Answer 1

Answer #1

Requirement 1

Galactic Inc
Production budget
	Jan	Feb	Mar	1st Quarter
Units to be sold	380	360	432	1172
Desired Ending Finished Inventory	90	108	98	98
Total Units needed	470	468	530	1270
Less : Beginning Finished Inventory	95	90	108	95
Units to be Produced	375	378	422	1175

Requirement 2

Galactic Inc
Direct Materials Budget
for the month of------
	Jan	Feb	Mar	1st Quarter
Budgeted production (units)	375	378	422	1175
Materials requirements per unit	2	2	2	2
Materials needed for production (LED)	750	756	844	2350
Budgeted ending inventory (LED)	151.2	168.8	163.6	163.6
Total materials requirements (LED)	901.2	924.8	1007.6	2513.6
Beginning inventory (LED)	150	151.2	168.8	150
Materials to be purchased (LED)	751.2	773.6	838.8	2363.6
Cost per LED	$ 15.00	$ 15.00	$ 15.00	$ 15.00
Total budgeted direct materials cost	$ 11,268.00	$ 11,604.00	$ 12,582.00	$ 35,454.00

Alternate solution with answer in zero decimal place

Galactic Inc
Direct Materials Budget
for the month of------
	Jan	Feb	Mar	1st Quarter
Budgeted production (units)	375	378	422	1175
Materials requirements per unit	2	2	2	2
Materials needed for production (cc)	750	756	844	2350
Budgeted ending inventory (cc.)	151	169	164*	164
Total materials requirements (cc.)	901	925	1008	2514
Beginning inventory (cc.)	150	151	169	150
Materials to be purchased (cc.)	751	774	839	2364
Cost per lb.	$ 15.00	$ 15.00	$ 15.00	$ 15.00
Total budgeted direct materials cost	$ 11,268.00	$ 11,604.00	$ 12,582.00	$ 35,454.00

*409 x 2 x 20%. Budgeted units to be produced for april are given below

	April	May
Units to be sold	392	460
Desired Ending Finished Inventory	115
Total Units needed	507
Less : Beginning Finished Inventory	98
Units to be Produced	409

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Answer 2

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