Castil Corporation makes and sells a product called a Miniwarp. One Miniwarp requires 2.6 kilograms of the

Question:

Castil Corporation makes and sells a product called a Miniwarp. One Miniwarp requires 2.6 kilograms of the raw material Jurislon. Budgeted production of Miniwarps for the next five months is as follows:

August ........19,400 units

September ......20,700 units

October .....19,900 units

November ....20,400 units

December .....21,400 units

The company wants to maintain monthly ending inventories of Jurislon equal to 20% of the following month's production needs. On July 31, this requirement was not met since only 8,700 kilograms of Jurislon were on hand. The cost of Jurislon is $4.8 per kilogram. The company wants to prepare a Direct Materials Purchase Budget for the next five months.

The total cost of Jurislon to be purchased in August is

a. $252,019.20

b. $293,779.20

c. $242,112.00

d. $335,539.20

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...