Coca-Cola Enterprises is the largest bottler of Coca-Cola® in Western Europe. 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 Wakefield, UK, bottling plant are as follows for the month of May:
Coke ........176,000 two-liter bottles
Sprite .......112,000 two-liter bottles
In addition, assume that the concentrate costs $ 60 per pound for both Coke and Sprite and is used at a rate of 0.15 pound per 100 liters of carbonated water in blending Coke and 0.10 pound per 100 liters of carbonated water in blending Sprite. Assume that two liters of carbonated water are used for each two-liter bottle of finished product. Assume further that two-liter bottles cost $ 0.12 per bottle and carbonated water costs $ 0.05 per liter. Prepare a direct materials purchases budget for May 2014, assuming inventories are ignored, because there are no changes between beginning and ending inventories for concentrate, bottles, and carbonated water.

  • CreatedJune 27, 2014
  • Files Included
Post your question