Custom Windows has budgeted annual unit quarterly sales and production data as follows:

● Each unit requires 2 pounds of direct materials at a standard cost of $10 per pound.

● Payments for purchases of materials are 60% in the same month and 40% in the next month.

a. How many units should be produced for the quarter?

b. How many pounds should be purchased for the quarter?

c. What is the cost of purchases for the quarter?

d. The vendor for direct materials has offered the company a 2% discount if the company pays in the same month as the purchase. Describe the analysis that the company should undertake to decide whether to accept the discount offer from the supplier.

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Sales Beginning inventory, finished goods Desired ending inventory, finished goods Beginning inventory, direct materials Desired ending inventory, direct materials 30,000 units at $90 5,000 units 4,000 units 3,000 pounds 1,700 pounds