If 61000 pounds of raw materials are needed to meet production in August, how many pounds of raw materials should be purchased in July?
If 61000 pounds of raw materials are needed to meet production in August, how many pounds of raw materials should be purchased in July?
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Please show all work , I need to see the stepscalculated out...Thank you!!
Morganton Company makes one product and it provided thefollowing information to help prepare the master budget for itsfour months of operations:
| (a) | The budgeted selling price per unit is $60. Budgeted unit salesfor June, July, August, and September are 9,200, 23,000, 25,000,and 26,000 units, respectively. All sales are on credit. |
| (b) | Thirty-percent ofcredit sales are collected in the month of the sale and 70% in thefollowing month. |
| (c) | The ending finishedgoods inventory equals 20% of the following monthâs unitsales. |
| (d) | The ending raw materials inventory equals 10% of the followingmonthâs raw materials production needs. Each unit of finished goodsrequires 4 pounds of raw materials. The raw materials cost $2.50per pound. |
| (e) | Thirty-percent ofraw materials purchases are paid for in the month of purchase and70% in the following month. |
| (f) | The direct labor wage rate is $13 per hour. Each unit offinished goods requires two direct labor-hours. |
| (g) | The variable selling and administrative expense per unit sold is$1.80. The fixed selling and administrative expense per month is$62,000. |
| If 100,800 poundsof raw materials are needed to meet production in August, how manypounds of raw materials should be purchased in July? |
| Rawmaterials to be purchased | pounds |
| Morganton Company makes one product and it provided the following information to help prepare the master budget for its first four months of operations: |
| a. | The budgeted selling price per unit is $65. Budgeted unit sales for June, July, August, and September are 9,000, 21,000, 23,000, and 24,000 units, respectively. All sales are on credit. | ||
| b. | Thirty percent of credit sales are collected in the month of the sale and 70% in the following month. | ||
| c. | The ending finished goods inventory equals 30% of the following monthâs unit sales. | ||
| d. | The ending raw materials inventory equals 20% of the following monthâs raw materials production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $2.70 per pound. | ||
| e. | Twenty percent of raw materials purchases are paid for in the month of purchase and 80% in the following month. | ||
| f. | The direct labor wage rate is $14 per hour. Each unit of finished goods requires two direct labor-hours. | ||
| g. | The variable selling and administrative expense per unit sold is $1.60. The fixed selling and administrative expense per month is $60,000.
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