Coca-Cola Enterprises is the largest bottler of Coca-Cola in North America. The company purchases Coke and Sprite
Question:
Coca-Cola Enterprises is the largest bottler of Coca-Cola® in North America. The company purchases Coke® and Sprite® concentrate from The Coca-Cola Company, dilutes and mixes the concentrate with carbonated water, and then fills the blended beverage into cans or plastic two-liter bottles. Assume that the estimated production for Coke and Sprite two-liter bottles at the Chattanooga, Tennessee, bottling plant are as follows for the month of June:
Coke 192,000 two-liter bottles
Sprite 148,000 two-liter bottles
In addition, assume that the concentrate costs $75 per pound for both Coke and Sprite and is used at a rate of 0.2 pound per 100 liters of carbonated water in blending Coke and 0.15 pound per 100 liters of carbonated water in blending Sprite. Assume that two-liter bottles cost $0.07 per bottle and carbonated water costs $0.05 per liter.
Prepare a direct materials purchases budget for June 2008, assuming no changes between beginning and ending inventories for all three materials.
Step by Step Answer:
Financial And Managerial Accounting
ISBN: 9781337119207
14th Edition
Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac