Question

Nancy Daniel, Waterway & Paul Fabricators' purchasing manager, has just received the company's production budget for the first quarter.

		January		February			March
Budgeted Production		23,400		29,000			33,200

Budgeted sales of April is 34,000 and its beginning inventory is 15,000. May month budgeted sales is 26,000. Company policy requires an ending finished goods inventory each month that will meet 20% of the following month’s sales volume.

Each brick requires 6 pounds of clay, and Nancy expects to pay $1.50 per pound of clay in the coming year. Company policy requires an ending direct materials inventory each month that will meet 10% of the following month's production needs. Nancy expects to have 15,000 pounds of clay at a cost of $22,500 in inventory at the beginning of the year.

Prepare Waterway & Paul's direct materials purchases budget for the first quarter. (Enter price per pound to 2 decimal places, e.g. 52.75.)

			January		February		March		Quarter
	select an item                                                          Budgeted ending inventoryProduction needsStandard pounds per unitTotal DM required (lbs.)Standard cost per poundBudgeted productionBudgeted purchases costBeginning inventoryBudgeted purchases (lbs.)		enter a number of units		enter a number of units		enter a number of units		enter a number of units
	select an item                                                          Budgeted ending inventoryBudgeted purchases (lbs.)Production needsTotal DM required (lbs.)Beginning inventoryBudgeted productionStandard pounds per unitBudgeted purchases costStandard cost per pound		enter a number of pounds		enter a number of pounds		enter a number of pounds		enter a number of pounds
	select a summarizing line for the first part                                                          Budgeted purchases costBudgeted purchases (lbs.)Standard cost per poundProduction needsBudgeted ending inventoryStandard pounds per unitBeginning inventoryTotal DM required (lbs.)Budgeted production		enter a total number of pounds for the first part		enter a total number of pounds for the first part		enter a total number of pounds for the first part		enter a total number of pounds for the first part
	select an item                                                          Budgeted ending inventoryTotal DM required (lbs.)Budgeted purchases (lbs.)Production needsBudgeted productionBeginning inventoryStandard pounds per unitBudgeted purchases costStandard cost per pound		enter a number of pounds		enter a number of pounds		enter a number of pounds		enter a number of pounds
	select a summarizing line for the second part                                                          Beginning inventoryBudgeted purchases costBudgeted purchases (lbs.)Total DM required (lbs.)Budgeted ending inventoryProduction needsStandard cost per poundStandard pounds per unitBudgeted production		enter a total number of pounds for the second part		enter a total number of pounds for the second part		enter a total amount of pounds for the second part		enter a total number of pounds for the second part
	select an item                                                          Budgeted productionTotal DM required (lbs.)Budgeted purchases costBeginning inventoryBudgeted ending inventoryBudgeted purchases (lbs.)Production needsStandard cost per poundStandard pounds per unit		enter a number of pounds		enter a number of pounds		enter a number of pounds		enter a number of pounds
	select a summarizing line for the third part                                                          Budgeted purchases (lbs.)Standard cost per poundStandard pounds per unitProduction needsBudgeted ending inventoryBudgeted purchases costBeginning inventoryTotal DM required (lbs.)Budgeted production		enter a total number of pounds for the third part		enter a total number of pounds for the third part		enter a total number of pounds for the third part		enter a total number of pounds for the third part
	select an item                                                          Beginning inventoryBudgeted ending inventoryBudgeted productionTotal DM required (lbs.)Budgeted purchases (lbs.)Standard cost per poundProduction needsStandard pounds per unitBudgeted purchases cost		$enter a dollar amount rounded to 2 decimal places		$enter a dollar amount rounded to 2 decimal places		$enter a dollar amount rounded to 2 decimal places		$enter a dollar amount rounded to 2 decimal places
	select a closing name for this budget                                                          Standard cost per poundStandard pounds per unitBudgeted purchases (lbs.)Budgeted purchases costBudgeted productionBeginning inventoryBudgeted ending inventoryProduction needsTotal DM required (lbs.)		$enter a total dollar amount		$enter a total dollar amount		$enter a total dollar amount		$enter a total dollar amount

eTextbook and Media

Answer 1

23,400 6 Direct Material purchase Budget for 14 quarter Particular January February March. Budgeted production 29,000 33,200 Direct Material per mit 6 6 Total Direct Material 140400 174000 199200 (clay in pounds) (+) closing stock 17400 14520 (174000X10-4] 99200x104] [145200X104] - Opening stock (15000) (17400) (19920) Direct Material to be 142800 176520 193800 Purchased $1.50 $1-50 cost per pound $ 1.50 Total Budgeted direct $ 214200 $264780 $290700 Material cost 19920

5200 * Calculation of production Budget for April Particular units/ pounds Sales 34000 (+) closing stock (26000 X20-4) (15000) (-) 24,200 Budgetid production 6 pounds 145200 pounds

Answer to the above question is shown.