25. Alliance Company’s budgets production of 20,000 units in January and 24,000

Question

25. Alliance Company’s budgets production of 20,000 units in January and 24,000 units in the February. Each finished unit requires 3 pounds of raw material K that costs $2.00 per pound. Each month’s ending raw materials inventory should equal 30% of the following month’s budgeted materials. The January 1 inventory for this material is 18,000 pounds. What is the budgeted materials cost for January?

$120,000.

$163,200.

$127,200.

$84,000.

$79,200.

26. A sporting goods manufacturer budgets production of 57,000 pairs of ski boots in the first quarter and 48,000 pairs in the second quarter of the upcoming year. Each pair of boots require 2 kg of a key raw material. The company aims to end each quarter with ending raw materials inventory equal to 25% of the following quarter's material needs. Beginning inventory for this material is 28,500 kg and the cost per kg is $7. What is the budgeted materials purchases cost for the first quarter?

$798,000.

$766,500.

$598,500.

$829,500.

$997,500.

27.Glaston Company manufactures a single product using a JIT inventory system. The production budget indicates that the number of units expected to be produced are 199,000 in October, 207,500 in November, and 204,000 in December. Glaston assigns variable overhead at a rate of $0.75 per unit of production. Fixed overhead equals $156,000 per month. Compute the total budgeted overhead that would appear on the factory overhead budget for month of October.

$355,000.

$156,000.

$149,250.

$311,625.

$305,250.

Explanation / Answer

25)

Hence, correct option is $127,200

Required production in units of finished goods            60,000 =20000*3 Add: Desired ending raw-materials needed            21,600 =24000*3*30% Total units of raw-materials needed            81,600 Less: Beginning raw-materials            18,000 Units of raw-materials to be purchased            63,600 Unit cost of raw-materials $            2.00 cost of raw-materials to be purchased $     127,200

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