Johnson Manufacturing produces self-watering planters for use in upscale retail establishments. Sales projections for the first...
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Johnson Manufacturing produces self-watering planters for use in upscale retail establishments. Sales projections for the first five months of the upcoming year show the estimated unit sales of the planters each month to be as follows: (Click the icon to view additional information.) Inventory at the start of the year was 350 planters. The desired inventory of planters at the end of each month should be equal to 10% of the following month's budgeted sales. Each planter requires two pounds of polypropylene (a type of plastic). The company wants to have 20% of the polypropylene required for next month's production on hand at the end of each month. The polypropylene costs $0.25 per pound. Read the requirements. Plus: Desired ending inventory Total needed Less: Beginning inventory Units to produce 3,840 3,760 4,000 10,900 350 340 360 350 3,490 3,420 3,640 10,550 Requirement 2. Prepare a direct materials budget for the polypropylene for each month in the first quarter of the year, including the pounds of polypropylene required and the total cost of the polypropylene to be purchased. Start by preparing the direct materials budget through the total quantity needed, then complete the budget. Johnson Manufacturing Data table Direct Materials Budget For the Months of January through March January Number of planters to be sold February March Quarter January 3,500 Units to be produced February 3,400 Multiply by: Quantity of direct materials needed per unit Quantity needed for production March.... 3,600 April 4,000 Plus: Desired ending inventory of direct materials May 4,200 Total quantity needed Johnson Manufacturing produces self-watering planters for use in upscale retail establishments. Sales projections for the first five months of the upcoming year show the estimated unit sales of the planters each month to be as follows: (Click the icon to view additional information.) Inventory at the start of the year was 350 planters. The desired inventory of planters at the end of each month should be equal to 10% of the following month's budgeted sales. Each planter requires two pounds of polypropylene (a type of plastic). The company wants to have 20% of the polypropylene required for next month's production on hand at the end of each month. The polypropylene costs $0.25 per pound. Read the requirements. Plus: Desired ending inventory Total needed Less: Beginning inventory Units to produce 3,840 3,760 4,000 10,900 350 340 360 350 3,490 3,420 3,640 10,550 Requirement 2. Prepare a direct materials budget for the polypropylene for each month in the first quarter of the year, including the pounds of polypropylene required and the total cost of the polypropylene to be purchased. Start by preparing the direct materials budget through the total quantity needed, then complete the budget. Johnson Manufacturing Data table Direct Materials Budget For the Months of January through March January Number of planters to be sold February March Quarter January 3,500 Units to be produced February 3,400 Multiply by: Quantity of direct materials needed per unit Quantity needed for production March.... 3,600 April 4,000 Plus: Desired ending inventory of direct materials May 4,200 Total quantity needed
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To prepare the direct materials budget for polypropylene for each month in the first quarter of the year we need to calculate the pounds of polypropyl... View the full answer
Related Book For
Managerial Accounting
ISBN: 978-0176223311
1st Canadian Edition
Authors: Karen Wilken Braun, Wendy Tietz, Walter Harrison, Rhonda Pyp
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