Question 1 : Direct Material Purchases Budget ( 13 marks ) Frame Antique manufactures picture frames . Production for May are expected to be 20,000 units of various sizes . The following information has been provided : 20,000.00 4 Picture frames to be produced Framing Glass Backing 6 2 1 3 Material requirements per picture frame ( in meters ) 7 1.50 $ Purchase price 0.80 $ 30,000 4.00 $ 12,000 3,600 0, 0 9 3,000 Beginning inventory ( in meters ) Target ending inventory ( in meters ) 9,000 10 11 Required : Prepare a direct materials purchases budget . At the bottom of the budget , indicate the cost of purchases . Show ALL amounts as positive numbers . ( 11 marks ) Frame Antique Direct Material Purchases Budget For the Month ended May 31 Framing 14 Glass Backing 15 16 Materials required for production 17 18 19 20 21 Cost of material to purchase 22 Using your answer above , explain the purpose of this budget to management ( assuming they have not seen this budget before , and are not familiar with accounting ) . Marks will not be awarded if you do not use the numbers in your budget . Be very specific in your explanation !

Frame Antique manufactures picture frames. Production for May are expected to be 20,000 units of various sizes. The following information has been provided: Picture frames to be produced 20,000.00 Required: Prepare a direct materials purchases budget. At the bottom of the budget, indicate the cost of purchases. Show ALL amounts as positive numbers. (11 marks) Frame Antique Direct Material Purchases Budget Using your answer above, explain the purpose of this budget to management (assuming they have not seen this budget before, and are not familiar with accounting). Marks will not be awarded if you do not use the numbers in your budget. Be very specific in your explanation! (2 marks)