Tiilikainen Oy has prepared a sales budget of 42 000 finished units for a three-month period. The

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Tiilikainen Oy has prepared a sales budget of 42 000 finished units for a three-month period. The company has a stock of 22 000 units of finished goods on hand at 31 December and has a target finished goods stock of 24 000 units at the end of the succeeding quarter.

It takes 3 litres of direct materials to make 1 unit of finished product. The company has a stock of 90 000 litres of direct materials at 31 December and has a target closing stock of 110000 litres.

Required

How many litres of direct materials should be purchased during the 3 months ending 31 March?

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Management and Cost Accounting

ISBN: 978-1405888202

4th edition

Authors: Alnoor Bhimani, Charles T. Horngren, Srikant M. Datar, George Foster

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