Three grams of musk oil are required for each bottle of Mink Caress, a very popular...
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Three grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $1.90 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3: Budgeted production, in bottles Year 2 Year 3 First 68,000 Second 98,000 Third 158,000 Fourth First 108,000 78,000 The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 40,800 grams of musk oil will be on hand to start the first quarter of Year 2. Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Required production in units of finished goods Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Desired units of ending raw materials inventory Total units of raw materials needed Less: Units of beginning raw materials inventory Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Answer is not complete. Mink Caress Direct Materials Budget - Year 2 First Quarter Second Quarter Third Quarter Fourth Quarter Year 68,000 98,000 158,000 108,000 432,000 3 3 3 3 3 204,000 294,000 474,000 324,000 1,296,000 Three grams of musk oil are required for each bottle of Mink Caress, a very popular perfume made by a small company in western Siberia. The cost of the musk oil is $1.90 per gram. Budgeted production of Mink Caress is given below by quarters for Year 2 and for the first quarter of Year 3: Budgeted production, in bottles Year 2 Year 3 First 68,000 Second 98,000 Third 158,000 Fourth First 108,000 78,000 The inventory of musk oil at the end of a quarter must be equal to 20% of the following quarter's production needs. Some 40,800 grams of musk oil will be on hand to start the first quarter of Year 2. Required: Prepare a direct materials budget for musk oil, by quarter and in total, for Year 2. Required production in units of finished goods Units of raw materials needed per unit of finished goods Units of raw materials needed to meet production Add: Desired units of ending raw materials inventory Total units of raw materials needed Less: Units of beginning raw materials inventory Units of raw materials to be purchased Unit cost of raw materials Cost of raw materials to purchased Answer is not complete. Mink Caress Direct Materials Budget - Year 2 First Quarter Second Quarter Third Quarter Fourth Quarter Year 68,000 98,000 158,000 108,000 432,000 3 3 3 3 3 204,000 294,000 474,000 324,000 1,296,000
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To prepare a direct materials budget for musk oil for Year 2 we need to calculate the units of musk oil needed each quarter taking into account produc... View the full answer
Related Book For
Managerial Accounting for Managers
ISBN: 978-1259578540
4th edition
Authors: Eric Noreen, Peter Brewer, Ray Garrison
Posted Date:
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