$5,550 $21,315 $6,090 $19,425 Casper Corporation makes and sells a product calle

Question

$5,550 $21,315 $6,090 $19,425 Casper Corporation makes and sells a product called a Miniwarp. One Miniwarp requires 3.5 kilograms of the raw material Jurislon. Budgeted production of Miniwarps for the next five months is as follows: The company wants to maintain monthly ending inventories of Jurislon equal to 10% of the following month's production needs. On July 31, this requirement was not met since only 6,900 kilograms of Jurislon were on hand. The cost of Jurislon is $3.00 per kilogram. The company wants to prepare a Direct Materials Purchase Budget for the next five months. The desired ending inventory of Jurislon for the month of September is: $5,550 $21,315 $6,090 $19,425

Explanation / Answer

desired ending units for the month of september = 0.10 *20,300 =2,030 units kg of jurislon required = 3.5*2,030 = 7,105 kg total price =7,105 *3 = $ 21,315 (answer)

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